Wednesday, March 10, 2010


Ever wondered what investments give us the best returns? Is it equities, real estate, sovereign bonds or business? How about structured notes, mutual funds or index funds? What about derivatives, options or forwards?

Well, there seems to be a plethora of investments out there, from simple ones to really sophisticated instruments. The yields that you get from these investments will depend on the risk that you are willing to take and that will be affected by many factors like the market, economy, politics and every other conceivable situation.

Here’s one investment that will surely give you a very good yield, no risk and even limitless return on equity. It is such a good investment that, as a financial planner, it is always my first recommendation. No, it’s not a scam, it’s really legitimate. It is education.

Education gives us the ability to learn things that open doors for us. It makes us knowledgeable on the risks that we are about to take. It spares us from a lot of mistakes that can cause us a lot of financial and psychological grief.

Education goes beyond a university, it goes beyond classrooms, it goes beyond training rooms. I am always very eager to attend trainings, read books and materials, surf the web, browse through e-mails, listen to good speakers, etc. I’ve made a lot of investments, and there is only one investment that I count on that will yield me positive returns—education. If I total the amount of money I spent to further my education professionally, I probably could buy a nice car already. But had I not invested in my education, I don’t think I will be where I am right now.

Part of my education is also talking to a lot of people. Having coffee with people will really be such an enriching experience that really gives untold rewards. I remember conversing with Francis Kong late last year and he mentioned something to me that really caught my attention—leveraging oneself and working with partners. I actually read that somewhere and my encounter with Francis validated that, and I took action. The benefits that I enjoy from applying what I learn because of education is really beyond any mathematical comp*tation.

“Whether rich, middle class or poor, they all have one thing in common: to make more money and to be more successful in life. They are pretty much open to anything they can get hold onto to improve themselves and the way they do things.

“But one glaring thing that caught my attention is that rich people put value in educating themselves more than they entertain themselves; while poor people entertain themselves more than they educate themselves.

“How can you prove that? If you invite poor people to a seminar or learning event, the first question they ask is, ‘May bayad ba? Libre ba? [Does it have a fee? Is it for free?]’ If you say yes, they start to change the topic and pretend they never asked. Other poor people will respond, ‘Ang mahal naman! [It’s too expensive!]’

“However, rich people will ask question like ’Ano ang topic? Ano ang matutunan ko? [What is the topic? What can I learn from it?]’ Rich people will respond, “Kahit mahal. Gagawa ako ng paraan. [Even if it is expensive, I will find a way to raise the money to get there.]’”

Want to understand personal finance better? Invest in your education. Buy books, attend seminars. I knew someone who took the Registered Financial Planner course and paid P 25,000. What was incredible is that he is not in any financial industry and has no plan of being a financial practitioner. When I asked him why he needed to take the course, he said that P25,000 was a small cost to shell out if that will mean he can put his financial life in order, save on hiring a planner, make wiser financial decisions and understand investing better. Wow!

What follows next is the life experience you gain along your goal towards financial freedom.


  1. You dont need to spend 25k in courses to manage your own finances.

    For example, our organization here in Dubai teaches OFW series of financial education from savings, investments, estate planning, retirement, education fund planning, etc.

    The cost is 1/4th of the normal 25k RFP courses there in the Philippines.

    I, myself, an engineer by profession has taken these courses because I believe in one thing.. NOBODY CARES MORE ABOUT YOUR FINANCES THAN YOU DO.

    Attaining life goals, including financial goals, requires (1) right information/knowledge (2) planning (3) implementing your plans

  2. The risk of investing especially in the stock market is minimized thru simple analysis of the market psychology. First, think of long term investments-5, 10 to 20 years. Take advantage of the compounding interests! Second, invest in great companies with track records that they will still be here over the next 50 to a hundred years! Third, invest regularly like monthly or quarterly. Finally, observe the SAM strategy applied by the truly rich club members of Bro Bo Sanchez. Buy at buy-below-price and sell at a target price and be amazed of your money’s growth over time.
    Happy Investing!