How to earn money (without working hard)

Q: I've been working for the past 20 years, and frankly, I want to get out of the rat race someday. I don't want to continue working until I die. Aside from starting a business, what other ways can I earn money without working so hard? - Paolo

A: It sounds like a good deal - the idea of earning money without working so hard. After working in the corporate world for a long time, you may have a valid reason for leaving the work force. You may be tired, you want to take it easy, or just want to enjoy the fruits of your labor.

While starting a business can let you earn money on your own and let you have control over your own time, it does entail a great deal of work. Many successful entrepreneurs credit their success to working hard, maybe even more so than those employed full-time in the corporate world. Indeed, it takes a great amount of sheer guts, determination, and sweat to build a business from scratch. But the rewards in the long run will be sweet and fulfilling.

Is there a way to earn money without working hard? Yes, there is. It's called investment. You save an amount of money, put it in an investment product, then let it earn interest on its own over time. There are many financial products you can choose from. Let's go over some quickly:

1. Government securities. You can invest your money in potentially less risky securities issued by the Philippine government. Such papers include retail treasury bonds (RTB), treasury bills, and treasury bonds. Treasury bills or T-bills are short-term instruments with a term of less than a year. Treasury bonds may have a term of 3 years or 5 years, wherein you lock your money for that period of time. With an RTB, you can invest an amount as little as P5,000. T-bills and treasury bonds require a bigger amount of money. These instruments offer a higher interest rate than that offered by bank deposits, at potentially lower risk to the investor, meaning you are taking on the credit of the Philippine government in order to receive your principal back at the end of the term. Interest will be credited to your account regularly (e.g., quarterly) during the entire length of the term.

2. Bonds. You can also "lend" your money to corporations raising additional capital and you will get a regular interest income over the length of the corporate bond to be issued to you. There is some risk involved as there is the possibility of default on the part of the bond issuer; however, you will need to exercise prudence and in choosing which bond to invest, consider a number of factors, including looking at issuers which are reputable companies with good business track record in terms of product and service, creditable industry standing and solid financials in order to determine whether investment is appropriate for you. The rate of return may be higher than that offered by bank deposits and government securities.

3. Stocks or equities. You may "own" a piece of a company listed on the Philippine Stock Exchange by buying shares of stock. There is a minimum board lot (minimum shares to be purchased, in other words) and you have to deal with a licensed stock broker, thus you also have to shoulder broker's commission and other fees. However, stock prices may shoot to the roof anytime, thus it is possible to earn more income with this investment rather than bank deposits, government securities, or bonds. But bear in mind that with the volatility of the market, stock prices may also go down in value, way below your purchase price, which will give you a loss. The risk is high in this investment, but investors who are in it for the long term may reap the benefits.

4. Pooled funds. You can join a fund pooling investments from other small investors. These funds may be mutual funds run by mutual fund companies or unit investment trust funds managed by banks. With these funds, you don't need to monitor the markets daily; the fund managers do that and invest the fund as they see fit. All investors share in the gains and losses of the funds. The price of the mutual fund share or unit investment trust fund changes depending on the net asset value per share / per unit on a relevant day. There are funds that invest only in bonds (bond funds), equities (equity funds), money market (money market funds) or a combination of them (balanced funds).

5. Real estate investment trust (REIT). This is a fairly new investment vehicle, with the law being passed in December last year. However, REITs have been a regular in the investment arena in other countries. REIT makes it possible for investors to own a part of an income-generating property. This may be a good addition to one's investment portfolio.

So it is possible to earn money without working too hard? Yes – you just have to make your money earn for you via investments. Save money, then invest it to reap the results. Talk to your bank or financial adviser today to find out which investment/s you may consider that would suit you best.

Source:Inquirer.net

Save or pay off debt? What to do when money is tight

Q: I work as a freelance graphic designer. There are months when I earn a lot, and times when I'm not. Since middle of last year, my income has gone down mainly because my existing clients were all affected by the typhoons, and decided to cut down on some projects. Sometimes I earn just enough to get by. I have some savings, but I am having second thoughts on whether to continue saving at this time. My credit card debt is piling up, and I am afraid it will even be bigger unless my income situation improves. Will it be a good move to stop saving and just pay off my debts? But this will bring my savings back to near zero. - Julie

A: Working freelance gives you the opportunity to choose your projects and work at your own pace at your own time. The downside of this is that, as you have discovered, the income stream may not be steady. You don't have a fixed salary that you collect every 15th and 30th day of the month. You also don't know when you will be able to collect payments from your clients. However, the possibility of earning more than what you may earn as a full-time employee is there; you do not have set limits.

So there would be days when you have much work and much income, and less work and less income. For some people, they prefer this arrangement as it allows them to be their own boss. It's like going into business, which comes with risks.

It is good that you have built up some savings at this point. This will tide you over when you go through the lean months. However, with your debt piling up, it is indeed tempting to just pay off all your debts and start clean. After all, interest charges on unpaid balances can indeed be an added burden. But paying off all your debts now will also decrease
your savings greatly or wipe it out altogether.

Should you hold off saving for now and just pay off your entire credit card debt? We say no.

The purpose of saving is to sustain you during the times when you really need extra funds. This may happen when you lose a job, go through a difficult time when death happens in the family, or when you finally decide to retire. You have seen how important savings is; now that your income is not steady, there is a pot of funds readily available. But if you wipe out all your credit card debt now with your savings, you may not have enough funds left should something happen to you tomorrow, the day after, next week, or even a year from now. You have to be ready for what may happen and not just rely on the thought that you can rack up new charges on your credit card.

How then can you deal with your situation? Here are our suggestions:

1. Assess how much you exactly owe. Write down the amounts you owe on your credit card, including finance charges and interest charges, if any.
2. Find out how much is the interest rate used by your credit card.
3. Check with SSS or GSIS if you can get a loan for a much lower interest rate. If so, take out a loan and use the proceeds to pay off your credit card debt in full. The monthly amortization of your loan payment to SSS or GSIS will be easier on your pocket as you may access low-interest loans from these institutions.
4. In case you cannot get a loan from SSS or GSIS, call your credit card company and ask if they can amortize your existing balance over the next few months at a lower interest rate. If you have been a loyal customer with a good paying record, they just might accommodate your request.
5. Look for other ways to increase your income. Search aggressively for potential clients, ask for referrals, and show off your portfolio. Partner with another business, such as a web developer, in offering your services to potential clients. And look for possible sidelines you can do also, such as teaching, to augment your income. Then use this
additional income to pay off debt.
6. Sell off an asset you have but don't use. Maybe you have an extra computer that you don't really use much, or an antique table that just gathers dust in the corner. Turn that nonperforming asset into cash and use the proceeds to pay off your loan.
7. Cut down on unnecessary spending. If you like eating out, do it less frequently. When you're tempted to get gourmet cafe at a coffee shop, promise yourself you'll brew a good cup at home instead. Little things like this can help you free up more money for saving.
8. Continue to save. Set aside money for savings even before you spend the rest of your income for the month. This will be for your future.
9. Follow your budget. Experts recommend that debt repayment should be no more than one-third of your take-home pay so that you will have money left for your living expenses. Set a limit for your other expenses and live within your means.

By following the above suggestions, you will eventually find out that you have finally paid off your debt and still have built up some savings. Discipline is the key.

Source:Inquirer.net

The top 10 biggest Philippine banks in terms of total assets are:

By Wilson Lee Flores

1. BDO — Led by Henry Sy’s hardworking and visionary daughter, chairman Teresita “Tessie” Sy-Coson, with president and CEO Nestor Tan.

2. Metropolitan Bank and Trust Co. — Led by taipan George S.K. Ty’s eldest son Arthur Ty. One of their executive vice presidents is Fabian Dee, who is my paternal cousin and a grandson of the prewar lumber tycoon and postwar Federation of Filipino-Chinese Chambers of Commerce & Industry, Inc. (FFCCCII) executive vice president Dee Hong Lue. A subsidiary of Metrobank is the second-largest savings bank, Philippine Savings Bank (PS Bank), led by president Pascual Garcia III and executive vice president Rolando A. Rodriguez.

3. Bank of the Philippine Islands — Controlled by the Zobel Ayala clan and led by president Aurelio Luis R. Montinola III, whose wife, lawyer Gizela Madrigal Gonzalez-Montinola, is a favorite niece and one of the three main inheritors of the multi-billion-peso fortune of childless Consuelo “Chito” Madrigal Collantes, who died last year. Collantes had appointed the BPI president as executor and trustee of her last will and testament, along with corporate lawyer Perry Pe, who is a son-in-law of John Gokongwei Jr. Atty. Pe and Gonzalez-Montinola are partners in the top law firm Romulo Mabanta Buenaventura Sayoc and De Los Angeles.

4. Land Bank of the Philippines — Led by chairman Margarito Teves and president Gilda E. Pico. It released P11.2 billion in loans to small farmers and fisher folk in the first half of 2009, higher by 42 percent or P3.3 billion from the P7.9 billion it extended a year ago. Its special mission is to help farmers and fishermen.

5. Philippine National Bank — Controlled by Philippine Airlines’ Lucio Tan, who also owns Asia Brewery and the 11th biggest bank, Allied Bank. PNB and Allied Bank will soon merge. According to present figures, a merger of PNB and Allied Bank will result in a much bigger giant, but will still be ranked No. 5 and will still be smaller than the government-owned Land Bank.

6. Development Bank of the Philippines — Led by chairman Patricia Sto. Tomas and president and CEO Reynaldo David. DBP is making available a P15.3 billion facility that will finance improvements in the country’s logistics and infrastructure systems. This was one of the major development initiatives bared by top DBP officials led by Sto. Tomas and David during an investors’ briefing held Aug. 5 in Davao City.

7. Rizal Commercial Banking Corporation — Led by chairwoman Helen Yuchengco Dee (wife of China Bank president Peter S. Dee) and president Lorenzo Tan (coincidentally the younger brother of BDO president Nestor Tan).

8. Union Bank of the Philippines — Led by chairman Justo Aboitiz Ortiz, president Victor Valdepeñas, board vice chairman and ExCom chairman Jon Ramon M. Aboitiz and vice chairman Vicente Ayllon of 99-year-old Insular Life. Union Bank is a partnership of the Aboitiz conglomerate, Insular Life and SSS.

9. China Banking Corporation — Controlled by Henry Sy but still professionally managed by founder Dee C. Chuan’s nephew Gilbert Dee with chairman and grandson Peter SyCip Dee as president. Henry Sy’s son and SM Malls’ Hans Sy is vice chairman of China Bank. It was the first Philippine bank to electronically process online deposit transactions in 1969 and was also the first bank to offer telephone banking in 1988. During the 1970s martial law era, when other banks feared lending money to Hacienda Luisita and other businesses owned by the Cory side of the Cojuangco clan because of the imprisoned Ninoy Aquino, it was said to be only China Bank that continued to do business with this branch of the Cojuangco family. The reason given? China Bank has reportedly been doing business continuously with the Cojuangcos since the prewar era.

10. Citibank N.A. — Citibank’s local operations are led by Sanjiv Vohra, who first came to the Philippines in 2005. The largest foreign bank in the country, Citi has been doing business in the Philippines for 107 years.

Global banking for citizens of the world

By Tanya T. Lara

When we hear of executives living out of their suitcases, transplanting their families from one country to another every couple of years, and picking up language skills as they move around the world, we are more than a little envious.

They are citizens of the world, no one country can claim them, and they have friends in all corners of the globe.

What we fail to see behind their seemingly glamorous world of corporate work and travels are the practicalities of such a lifestyle. How do they deal with their bank accounts, for example? Or how do they pay their bills when their credit cards are from one country and they are living a continent away? How do they balance their checkbooks? How do they pay cash when they keep changing currencies as they are based in a foreign country but still have to travel several days a month in other countries?

Citigold Wealth Management director Judith U. Go, in a previous interview we had, said that what they are constantly doing at Citi is to innovate and anticipate their clients’ needs. “The result is an array of specialized services that we call Citigold Global Banking, which represents products and services attuned to the needs of expatriates, frequent travelers and global investors.” The minimum opening balance for a Citigold relationship is P4 million or its US dollar equivalent.

The practicalities of everyday banking and looking after your investment portfolio are settled even before you leave the country for your foreign assignment.

At Citi, says Judith, “Your credit history crosses the borders with you. So even before you leave for abroad the application process for your local credit card has already been started allowing you to have this on hand when making purchases as you settle into your new home abroad.”

You can even maintain a multi-currency account if you have financial interests in more than one country “to enable you to take advantage of currency fluctuations and global market opportunities.”

In this interview, we asked Judith how Citi’s Global Banking has made the world a truly smaller place where you can pick up where you left off — anywhere in the world.

How would you define a true global bank?

JUDITH GO: It’s not enough to have your presence in other countries to be called a global bank — it’s ensuring that the products, services, benefits and privileges are made available to any client anywhere in the world should they wish to avail of it. It’s about making your global network and resources work for your customer. That’s what being global truly means.

How does Citigold Global Banking fit in today’s world and lifestyles?

Our global banking proposition is our answer to globalization. We’ve long realized that countries, economies and people do not operate in silos anymore and so interaction with and relocation to other countries is more pronounced, travel is more frequent and overseas products and services are now more accessible to everyone.

Global banking was designed with three client profiles in mind: the expatriate who relocates to another country for his career, the frequent traveler, and the global investor — one who may be based in one country but has investments in overseas markets and needs to be abreast of all related developments.

With Citi Global Banking, we are addressing the banking needs of clients who will be relocating abroad. We help them by facilitating a pre-arrival account and pre-arrival credit card giving them one less thing to worry about when adjusting in a new country.

For those who frequently travel — we give them access to the Delta Sky Club at NAIA 1 for their comfort when traveling. For their security, they have access to emergency cash withdrawal of up to US$10,000. For their peace of mind, we offer exclusive membership to International SOS, the world’s leading medical assistance provider to assist them in any medical emergency outside their home country.

Our global investor can have access to world-class products and services giving them more options to meet their financial goals.

Other banks also have a global network, what makes Citigold different?

Our global network means having more than just a presence in other countries — we make our globality work to the advantage of our customers. We have research analysts around the world, providing us with up-to-date information on market movements and analysis. Because of this, we are able to provide our clients with information on the latest market movements to help them make informed financial decisions.

Because of our global network, we can refer our Citigold clients to other businesses overseas should there be a need for them to avail of offshore products or services. We can make relocation for our clients seamless and hassle-free.

With our Global Services Center, we can help facilitate pre-arrival account opening and credit card application so that upon arrival in the new country, they can already go about their usual banking transactions. Having a credit card immediately in the country where you’ll be relocating is not easy – some will require that you establish a credit history first before they can issue you a credit card. But with Citigold Global Banking, we can facilitate for a client to have a pre-arrival credit card.

For Filipinos working abroad but still with family ties in the Philippines, how can Citi’s Global Banking help them?

We have a facility called the Citibank Global Transfers (CGT) where Citigold clients can transfer funds from their Citigold account to any Citibank account in over 20 countries in the world. This facility is available online or through any Citibank ATM. The funds transfer happens in real time, which is very useful particularly in emergency situations. Aside from the convenience and the speed, there are no charges for Citigold clients.

Can you elaborate on the preferential exchange rates?

Our Citigold clients enjoy preferential rates on foreign currencies, something that’s extremely advantageous to frequent travelers. They can also get preferential rates on their time deposits, enabling them to avail of higher amounts upon maturity of the deposit product.

What other perks do your clients get to enjoy?

Apart from lounge access at the Delta Sky Club at NAIA-1, they are also sent invitations to exclusive Citigold events, where they can get insights on making informed financial decisions. They can also call our 24-hour Citigold Wealth Management hotline for any of their banking needs.

Can you elaborate on the SOS service?

International SOS or ISOS is the world’s largest medical and security assistance company that offers Citigold clients emergency healthcare assistance 24/7. Anywhere a client is in the world, whether it’s in his home country or outside, he can call a toll-free number, where he will be able to speak to medical assistants who will help him in his emergency needs.

For those who have found themselves in a similar situation while traveling, especially in a foreign country where language may be a barrier, this service will be most welcome. This is just one of the many things we do to anticipate the needs of our clients.

How does the pre-arrival bank account and credit card work?

When relocating to another country, Citigold clients can open a new account even before they leave their home country. The account will be ready for transactions immediately upon their arrival. Citigold clients are also entitled to a pre-arrival credit card, which they can immediately use as soon as they arrive in the new country. Their credit history as Citigold clients will also apply to their credit card entitlements in their home country.

Why should clients choose Citigold over other banks?

Citigold is all about putting our customers first by offering unparalleled services in wealth management, credit cards, deposits, investments, insurance and personal loans. With our Global Banking services, we not only offer you exceptional privileges and benefits. We offer you the world.

Source:Philstar.com