Philippine Personal Finance Podcast
Money Snacks is a Philippine personal finance podcast. This podcast is another channel to promote our blog here at Economerienda. Our aim is to provide business, law and life stuff in snackable form.
Here we’ll talk about personal finance, money management, investing, and more.
Money Snacks Episode List
- 6 – How to Find your WHY
- 5 – SMART Professional Goals
- 4 – Building Wealth: Like Baking a Pie
- 3 – Key Ingredients to Financial Wealth
- 2 – Four Basic Functions to Have Wealth
- 1 – Welcome to Money Snacks
- 6 – How to Find your WHY and Purpose
The Quest to Find your Why and Purpose
The Quest to Find your Why and Purpose – Finding your WHY is one of the key essentials to your financial planning journey. Your driving force has to be meaningful. Without your WHY, it will be difficult to maintain the discipline to move forward. Hence it is important to know your WHY and purpose in life.
Without a meaningful ‘why’, chasing that big paycheck and having fancy cars but still feeling stuck and miserable, making money for all the wrong reasons.
Money is just a tool, not the goal. Money is just a means for you to build a rich and fulfilling life. Read more:
Listen to the podcast
- 5 – SMART Professional Goal Setting
SMART Professional Goal Setting
SMART Professional Goal Setting – SMART goals concept is not new–it’s been featured across books on business and personal development. It’s taught in books, workshops and business schools. That’s because SMART Goals are so powerful.
Everyone says “I want to be rich!” but that’s a very vague thing to say. Go beyond vague and general goals like ‘my goal is to be rich in five years’ time’, or ‘I want to be able to be able to save more’… those statements don’t mean anything because you cannot really measure the success of these statements.
SMART is short for Specific, Measurable, Attainable, Realistic, and Time bound.
- Specific: Clear, well-defined, concise
- Measurable: Defined specifically in terms of criteria to know the success or failure of the goal
- Attainable: Possible for you to achieve given your time, effort, and available resources
- Realistic: realistic and relevant to your purpose
- Timebound: clear defined timeline, start date and target date, to create a sense of urgency
Listen to the Podcast Episode on Professional Goal Setting:
- 4 – Building Wealth: Like Baking a Pie
Building Wealth: Like Baking a Pie
What does wealth look like to you?
Let’s use a baking analogy. Building wealth is like baking a pie. You need to put in work and preparation, and you need time, patience and dedication.
Baking requires key ingredients for your dough to rise. Baking requires proper measurements, taking the right steps and knowing what kind of delectable pastry you want to rise from your efforts.
The definition of wealth is subjective. Your dreams are yours…it’s highly customizable according to what you want, depending on your preference. What is your desired size? Whether financial wealth means ‘10 million’ or ‘100 million to you’, that’s for you to define the parameters.
What does financial freedom look like for you? Whatever the size or specs, the wealth pie should have the following components:
1. Zero Debt
Financial freedom means zero or minimal debt. This goes without saying, minimal debt (housing mortgage) or best scenario-zero debt at all. Eliminate bad debt completely–especially on high interest credit cards.
2. Savings for Threats
Right amount of savings for threats; a.k.a.: emergency fund. Emergency funds cover for the unexpected: a safety net to cover for unforeseen circumstances: medical emergencies, unemployment, calamities, epidemics (such as the latest COVID-19 pandemic), etc.
3. Funds for Future
Right amount of savings for your future; funds separate from your emergency fund. Make different nest eggs for your retirement, for your kids’ education, for long travel, etc.
4. Liquidity for Opportunities
Right amount of liquidity for opportunities. Just like in corporate finance, having too much cash lying around can be a bad thing–it means you are not allocating your assets right and you’re not investing them enough.
Having the optimal amount of liquidity is key so in case there’s a really good investment opportunity presents itself, you don’t want to be illiquid to get that deal. (P.S., it’s never pawn or mortgage something for an, air quotes, “once-in-a-lifetime deal”)
5. Multiple Income Streams
If you’re serious about getting rich, you need to build multiple streams of income. Have a side-hustle. Take a part-time job. Or start a home-based business. Build a brand and sell products online. Monetize through your blog, Youtube or podcast. Do research on how other people were able to do it.
6. Passive Income
Wealthy people love passive income (or royalty income), because you get paid for little to no work. Passive income is key to generating wealth over time because you don’t need to lift a finger. Examples of income include royalty income from books you’ve written, blog ads, selling digital products like courses and workshops; Dividends you receive from stocks; Rental income from apartments or properties you own, etc.
- 3 – Key Ingredients to Financial Wealth
Key Ingredients to Financial Wealth
Key Ingredients to Financial Wealth – First and foremost, you need to equip yourself with the right tools–the right attitudes, behaviors and habits must be in place to prepare yourself towards financial freedom.
Here are 8 Key Ingredients to Financial Wealth and ensuring success:
Your why is your purpose; your ultimate driving force. Figure out your main motivations, and establish a very compelling WHY (Find your WHY)
Without a meaningful ‘why’, you’ll end up chasing that big paycheck and having fancy cars but still feeling stuck and miserable, making money for all the wrong reasons.
What are your motivations? If your ultimate drive to financial wealth is to accumulate material wealth and stuff, it would be hard to sustain efforts. Money is not usually the best motivator, nor is collecting fancy stuff the end goal.
Remember this: money is just a tool. The ultimate purpose of finding your WHY is so that when you create money with purpose, you align purpose with life.
2. Personal Commitment
This should go without saying: to be successful you need to be committed to the hard work. You need to be passionate, you need to be consistent. You might not be able to see the results several years down the line. Successful people are marathoners, not sprinters.
3. Pro-Money Attitude
Stop telling yourself that money is evil.
Have you ever noticed people hating on wealthy people for no reason, angry at them just because they drive a Ferrari or own a big house? Stop thinking that money is dirty and the root of all evil. If you have a negative relationship with money, you will never attract any in their life. Embrace money in your life. It starts with a pro-money mindset.
4. Pro-Money Team
Your main team–your partner and your family–will help you realize your goal.
Surround yourself with money-minded friends. You are the average of the five people you spend the most time with. Expand your networks to people who are successful who also have a pro-money mindset.
You should also influence your friends to have the same goals–it will be more fun and easier if you have someone else undergoing this same journey and go through the same learning process.
5. Simple and Frugal Lifestyle
Adopt the right habits. It all starts with living below your means. Warren Buffett said that he only had one rule: don’t lose money. Sure, frugality isn’t fabulous or trendy, but it works. The more surplus you have, the more you can use it to invest in wealth-building opportunities.
Big-spending reflects irresponsibility. Big spenders get FOMO and make impulsive purchases. Spenders are no better at money management than those who win the lottery and squander it all away. (Foolproof Guide to Frugal Living)
6. Unwavering Curiosity and Growth Mindset
Having a curious mind leads you to constant growth. Invest in talents, skills, hobbies and interests that will enhance your lifestyle as well as your earning potential. Invest in education, read books, or work on learning or refining skills. Broaden and deepen your mind and connect with mentors. Use valuable resources to enrich your most valuable asset: yourself.
7. Valuable Resources
Find a good mentor. A good, experienced mentor has made the same mistakes, challenges, and setbacks that you have, and he will give you sound advice. Learn from the mistakes of others–it is less expensive! A good mentor knows what it’s like to be in your shoes, but can help you see beyond.
We live in a time when a lot of valuable content is now easily available–books, articles, podcasts, shows, and more. Consuming content is like consuming food for your brain–you must nourish your mind with healthy brain food, not junk food.
Read, and read a lot. Do you know that an average CEO reads an average of 60 books each year? Warren Buffett himself reads up to a thousand pages a day. Aside from books, consume valuable, high-quality shows, documentaries, and podcasts.
8. Sound Judgment
Hard work is a requirement to getting wealthy, but it’s not the ultimate deciding factor. In the end, sound judgment matters more.
All successful people are thinkers with leverage. Successful make important investment decisions amplified with leverage, to make sound judgment on how to allocate labor, technology, and capital.
Forming good judgment is through learned wisdom from experience, knowledge and advice from mentors.
Listen to the Podcast
- 2 – Four Basic Functions to Wealth
2 – Four Basic Functions to Wealth
What are the basic functions to wealth? How do you achieve a solid financial foundation when you’re still young and broke? Plenty of literature, blogs, books and podcasts have been dedicated on how to be financially wealthy.
Through my own personal journey, I’ve also simplified my own understanding of money management. Here are the four basic functions to wealth that we all have learned in grade school: MDAS (multiplication, division, addition, subtraction).
Before you start the journey, first and foremost you have to define your journey. That is by determining your end goal and your starting point:
- Your end goal is your definition of wealthy: is it 10 million? 100 million?
- Your starting point is your current net worth.
Let’s reverse the MDAS by tackling the last function first:
- Subtract (-) via Reducing Expenses Drastically. Living a frugal mindset, minimalist lifestyle and below your means.
- Add (+) via Increasing Income. Create multiple income streams
- Divide (/) via Proper Budgeting and Money Management. Be in control of your pie with proper allocation of your time, money and effort
- (x) is Multiplying Wealth via Investing and Diversifying into multiple investments: bonds, stocks, funds, real estate, bitcoin and the like.
START HERE on the simple Foolproof 5-Step Financial Guide
Listen to the Podcast
More on Personal Finance
6 – How to Find your WHY
5 – SMART Professional Goals
4 – Building Wealth: Like Baking a Pie
3 – Key Ingredients to Financial Wealth
2 – Four Basic Functions to Have Wealth
1 – Welcome to Money Snacks
Investing and Earning During a Crisis – Money Snacks IMG
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