My journey in the financial industry is a bit unexpected. Since I majored in Public Relations, I saw myself working in PR agencies or even advertising. And more than a year into my present job, I realize that I’ve matured in so many ways, especially on how I handle my finances.
I want to share my experiences and learning, my so-called Rude Awakenings, about money, saving, and investment. Sure, I’m no expert, but I know that I can offer some help, especially to young professionals like me. Remember, I’ve been there – until a hand bonked my head and pulled me out of financial oblivion.
Rude Awakening: Why do the rich become richer and the poor even poorer?
Consider this equation: a poor man has expenses; a middle class man will buy liabilities they think are assets; and the rich buy assets.
Simple, isn’t it? But the temptation, particularly for us who are experiencing the early fruits of our labors, is very hard to resist. I recently accompanied a friend scout for a brand new mobile phone because she got a humongous cash incentive at work. Still with cash to spare after that purchase, she then proceeded to buy a new HP Mini note because, according to her, “My notebook has become so bulky, I want something smaller.”
Then I got thinking. She was the clearest picture of a middle class person who buy liabilities, (gadgets, in this case) that she believes are assets. In, say, 3 months or less, HP must have come up with a newer model, something sleeker and smaller and by then her Mini Note must cost a fraction only of how much she bought it.
Not-so-Rude-Awakening: Buy assets.
Apparently, this is what rich people do; not only the born-rich, but those who want to be rich. It is at this point that stocks, UITFs (Unit Investment Trust Funds), shares and similar instruments come into place. I’ve also discovered a new mantra: The poor and middle class work for money, the rich have money work for them.
Next on my shopping list: some spanking new assets. The shoes can follow later on.
Author: Tara Arevalo
The rich men can buy anything from special foods, mile-high passes, expensive clothings to unimaginable luxurious things. The only difference is that they are wise enough to choose which of this things can separate them from the pretenders.