Saturday, April 20, 2013

Financially Stupid

Nope, I'm not trying to be judgmental, but if you think I am after reading the first few paragraphs, then it is either you whose judging me wrongly or I may have to repent later after writing this blog. But first, let me tell you a true story.

After one of the Financial Literacy Seminar he was teaching, a certain attendee went to approach the speaker, he is a CEO and Marketing Directors of a prestigious financial institution. The man said to him, "Sir, you gave a great lecture however, I want to attest to you that my wife is an asset and not a liability. Look at her, she is very pretty."

Mr. CEO just smiled and said,  "My friend, the definition of assets are people or things that helps put more money into your pocket."

"Tell me, does your wife help you put more money or savings into your bank account or does she spends most of them?"

"Well," the man said, "She buys a lot of nice expensive things, like make-ups and stylish clothing using my money."

"Then my friend," said Mr. CEO, "You have to talk with your wife and discuss how you will turn around your finances, because according to your story she doesn't sound like an asset to me."


On the next seminar schedule, the same man approached Mr. CEO again and said; "Sir, thank you for your advise. My wife now is truly an asset. We've spoken and she now started to be frugal. Also, she manages to save some of the money to our bank account every time I give her money from my salary." 

--The End--

End of the story now on to my blog. In one of the talk show videos I keep watching on you tube there is this episode I came across with, on which the main topic is the stupidity of women when it comes to finances. The guest of the show a financial expert said this about women; "Many Women are Peso smart but Million foolish." 

We'll, I believe that not all women are financially stupid, but most are... and men too! I didn't get to finish watching the whole episode but I have my own presumptions I have my own presumptions and here are just a few:

1. Women know where the latest mall bargain is but they don't know which companies of the stock market are on sale. 

Men, may or may not know where the mall sales are or they wouldn't even care; but they also don't know when the stock market is cheap or they don't even care about the stock market, period.

2. A hair re-bond session that charges a fee of not less that Php 1,000.00 is not so much to pay for, not knowing that 1,000.00 at 12% interest will turn into 1Million in 24 years.

What is a car loan when he can show off a brand new Porsche to his friends and dates.

3. They'd rather date a handsome guy who likes to spend his money more than he earns them, instead of dating the one who has potentials.

Men, would date a pretty girl instead of dating the smart ones who can make sense about money. 

After all is said and done, both of them are living in financial disaster!
In reality, most men and women of all sizes and shapes, many are still lacking in Financial Literacy. People still make unnecessary purchases and get scammed in wrong investments, which just proves that in this day and age; People are financially stupid. According to an anecdote I've once read, there are two kinds of people.

"The One who is rich, and The Other who wants people to think that he is rich. "

The other use to love fancy-schmancy things. To die for shoes and apparels,  Expensive perfumes, cool phones and gadgets and other branded items. In short, 'the must-haves that they don't really have to have.' They are lured into the world of consumerism. They feel they don't want to do anything with savings and financial investments since they feel that it's (1) only for the experts, (2) they just simply don't care about their financial future. 

I'm not saying that buying nice things are bad stuff. To be honest I like those kind of stuff too. I would love to have those if only they are given to me as gifts, I would appreciate it. Otherwise, I will have to make a way to afford it, otherwise... I can do without it for now.

If we try to secure our financial future by living frugally at our present status. We can rest assured that we can be comfortable in our old age. In short we can delay our instant gratification for a long term return of our investment. 

Others would contest, why study Financial literacy when "money is the root of all evil."? If that's the case, I who wrote this blog should have been cursed now? and if not now then maybe later in my life.

My take on it though, is this; We are stewards of God's creation, and as children of God, we can try to be abundant as much as we can in order for us to help build Lord's Kingdom on the earth. Money is Not the root of all evil. Take note that in 1 Timothy 6:10 the exact words were, "For the love of money, is the root of all evil." see the difference?

There is a need for a change of mindset if we'd lime to build a strong financial foundation. Discipline also, instead of spending money on useless stuff, we can still consider the difference our money makes as investible funds.

So, instead of upgrading your cellphone every month.Why not invest them on assets that can generate you more income in the future. There is a cost of course. It may affect our lifestyle a bit, and social life a bit but trust me, you'll survive without what you thought you can't live without. 

The question of so many of us then is this; Is it possible that people can really study and get into, Stocks, Bonds, Mutual funds and or UITF's to improve their financial status in life?

Why, yes! and if you ask why... then why not?

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