“Prevent thy purse from being emptied
once it has become well filled. Guard thy treasure from loss by investing only
where thy principal is safe, where it may be reclaimed if desirable, and where
thou will not fail to collect a fair rental. Consult with wise men. Secure advice
of those experienced in the profitable handling of gold. Let their wisdom
protect thy treasure from unsafe investments.”
Gold in a man’s purse must be
guarded with firmness, else it be lost. Thus it is wise that we must first secure
small amounts and learn to protect them. The first sound principle of
investment is security for your principal. Study carefully, before parting with
your treasure, each assurance that it may be safely reclaimed. Be not misled by
your own romantic desires to make wealth rapidly. Before you entrust it as an
investment in any field acquaint yourself with the dangers which may beset it.
Be not too confident of your own
wisdom in entrusting your treasures to the possible pitfalls of investments.
Consult the wisdom of those experienced in handling money for profit.
As I mentioned in the previous blog (make thy gold multiply), I
mentioned that I have invested in real estate, computer business, condominium
and in the Philippine stock market.
My first investment in the real
estate is not as profitable as I thought. I assumed that it will be a
profitable investment until I realized that I haven’t gain anything from it
aside from appreciation of its value but instead I am paying the yearly tax. Although,
I do not regret buying a lot in the Subdivision, but somehow I should think of
ways on how it will become profitable.
We also opened our Computer shop business in
2010 finance by me and my sister and managed by our brother which was successful
for the first few months after opening but we closed it down in 2013. The probable reason we thought is that
because of the location (barangay), lack of innovation, no proper advertisement
and many competitors that began to sprout around our area. Although we made feasibility
study before opening the business but it didn’t went well as we expected it to
be. We somehow have a break-even on this business venture but we learned
something about it that we can use in our next venture.
I purchased a Condominium unit in 2010 by a
prominent developer in the Philippines. The location was good and the promise
of a good investment is enticing. Although I don’t have a thorough
understanding of the real estate business specifically a condominium investment
and how it works, I entered this investment without thinking over that much. In
the end, I didn’t expect that I needed to pay some extra fees that I legally have
to pay but was not aware of it until I received notice from my developer.
I need to pay Closing Fees which covers
Documentary Stamp Tax, Transfer fees, Registration Fees, notarial and
documentation and other administrative and handling fee in order to transfer
title to buyer’s name (this amount is already added in my bank loan). I also
need to pay Condo dues upon unit turn over, joining fees, Meralco deposit,
water meter deposit, association dues and other charges (CCTV and fire
extinguisher and share in common area). Association dues will also need to be
paid on a monthly basis being a part of the Condominium association. Aside from
that, I need to furnish my unit in order to be leased higher. All these are not
being expected by me or I was just ignorant about it. Nonetheless, it is my
fault for not knowing about it. L
But then I realized that although the
payment is quite overwhelming at the beginning, but in the long run when a
tenant is already occupying the unit, the rent will ease the monthly payment and
somehow will cover it in the long run, so it is like the tenant is the one
paying your loan in the bank while you will own it in the future. J
When I thought that I could manage to have
another investment, I started to invest in the Philippine Stock market with the
help of Bro. Bo Sanchez’ Truly Rich Club through peso cost averaging. He gave
guidance on how to invest in the stock market even with a small amount of
money. I was inspired of his book “How my
maids invest in the stock market”. It is this investment that I am enjoying
right now as I have a mentor that guided me which company to buy and when to
sell. It is also this investment that saved me in times that I needed to pay
for extra payment during my condominium unit turnover. Somehow I regret it
because that money I have withdrawn have already gained interest but I need to
pay the fees immediately instead of getting into debt, I decided to get it from
my stock investments.
In all these investments, I
realized and learnt that I should be knowledgeable in the area/business that I
want to enter into. I cannot rely only on my own wisdom and the heresy from
other people that are not even in the certain field but should seek the wisdom
of people who are already successful. I should take responsibility of knowing and
learning how certain investment works. I made a mistake in not studying the
investments I am into and just dive in it since people say that it is a
“profitable investment”.
Before investing, we should be knowledgeable
on the matter that we would like to invest. The do’s and don’ts, the laws
covering it, taxation or legal matter etc. that comes with the investment
instrument. We have to guard our hard-earned money.
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