It was an awesome privilege to attend the Makati Business Club meeting, with Suze Orman as the guest speaker. While being introduced, she sat on an empty seat along my row and said hi to me. The fact is I am such a nerd and this was a fangirl moment for me.
Orman’s goal that afternoon was to get our (the audience) insight on issues that should be addressed in the free financial literacy course she has been developing. A lot of questions were raised, including:
1. How do we save for ourselves, while taking care of our families?
2. Should a young executive buy a condo as an investment?
3. Is it a good time to invest in the Philippines?
To answer the first question, Orman starts by revealing that she has a call center here in the Philippines and employs Filipinos in her company in the US as well. She is very familiar with the Filipino culture of helping every person in our family to the point that we do not have anything saved or use whatever we have saved. Orman clarified that it is a good thing and a privilege to take care of our parents. As for siblings, aunts, uncles, and cousins, she says, sometimes helping is hurting. We really do not help anyone by giving them money. She added that our savings are for others, investments are for us.
Another thing that struck me the most, since I was feeling guilty about it recently, is when Orman said you do not have to give more money to your parents/family just because your means expanded. She clarified that if they are getting by with what you were giving them before you had more income, then you should continue giving them the same amount and put your extra money in an investment.
Next, a young lady in the audience told her story about her boss giving her advice to buy a condo as an investment. She then asked Orman if this was a good idea. Instead of directly answering her question, Orman asked the young lady how she felt about the advice. The young lady replied that she was nervous and felt that she is not ready yet. This is where I got more illuminated. Orman replied that if the ‘money decision’ makes you nervous or uncomtortable, it is a definite sign that you should not do it. She explains that the goal of money is to make you feel safe and secure. The reason many people are in bad debt is because they feel insecure. They feel like they need a flashy car, a condo, and the latest gadgets to be perfect. What they do not realize is they are already perfect, regardless of the things they own. On a side note, Orman observe that developers in the Philippines are building condos too fast. Such that, if you buy a condo now and decide to sell it after a few years, it will be difficult for you to sell it because your old condo is competing with newer condos of the same price.
Lastly, Orman advised to invest here in the Philippines because the economy is still on the rise. She recommended investing uitfs and the Philippine Stock Exchange Index Fund; and to be wary of bond funds. She adds that uitfs and pseif outperform the stock market in the long run. Orman is also not a fan of life insurance being sold as investment instruments. The only insurance a person needs, she says, is term life insurance.
Before concluding the forum, Orman shared with us the three laws of money:
1. Live below your means, but within your needs
2. Is it a want or a need?
3. Get as much joy out of saving as you do with spending
To further quote Orman, now is the time to change things around. I truly look forward for her free financial literacy course to come to fruition soon. Hopefully, more people will be inspired to take action and be financially free.
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