Showing posts with label Relationships. Show all posts
Showing posts with label Relationships. Show all posts

Sunday, May 14, 2017

Rich Mom, Poor Dad: a tribute to my mom who saved us all

My mom came from a rich family in the northern Philippine town of Batac, Ilocos Norte. The same town where the late dictator Ferdinand Marcos, known for looting the country of billions of dollars, grew up. In fact, they were contemporaries. My mom told me stories about how Ferdinand's father, Mariano Marcos-- a budding candidate for the country's National Assembly, use to borrow money from my grandfather who was a U.S. Navy veteran with 'boatloads' of money that can potentially finance his campaign.

No, my mom didn't get rich because my grandfather stole from the U.S. Navy. Nor did she become rich because she happens to date a future billionaire dictator when they were younger. Ferdie wasn't her type anyway. For one thing, he was 13 years her senior. Another thing is that he was an accused murderer. In 1935, young Ferdie was charged with murder. He was accused of personally pulling the trigger that killed his father's political rival, Julio Nalundasan. The murder happened just a few days after his father lost the election to the latter. A charge that he was initially convicted of. But it was somehow overturned by the country's Supreme Court. Marcos was subsequently acquitted and eventually rose to power to rule the country for 21 years. He was eventually deposed but only after leading the nation to economic peril.

Her rich upbringing

Note that being rich is a relative term. When you can barely eat 3 square meals a day, like most poor Filipinos struggle to do, and then you suddenly find a large elaborately prepared food on the table, then that can instantly make you feel rich. My mom's family weren't filthy rich, but they were probably in the top 5% of the society that they lived in. In that sense of the word, she grew up rich.

My mom and her siblings weren't raised in a mansion, neither were they fed with a silver spoon, but they lived a very comfortable life. My grandpa who had thriving real-estate investments chose to continue to live modestly. After World War II was over, he was able to send all his 5 children to study in Manila when the dust finally settled. Three of her siblings eventually became physicians. Two eventually made their way to the states to practice lucrative careers. My mom learned her very first lessons in frugality from my grandfather.

My mother told me that her household was the first one in town to ever buy a refrigerator. A very expensive luxury at the time. Her 'rich' neighbors initially made fun of them thinking that it would be impractical to use one as they hardly have reliable electricity in the neighborhood. Soon enough when everything stabilized, they started buying their own to keep up with the Joneses. Back in the day, people get by without refrigerators by preserving meat by traditional methods-- removing the fat, applying salt, and letting it cure under the sun.

Grandpa's U.S. Navy stint

As a young lad, my grandpa was a U.S. Navy sailor. He was honorably discharged shortly after World War I. His total pay per month while in service was $17. At the time of his discharge, he was paid $145 in full and $38 per month in benefits, thereafter. If you factor in inflation, his veteran benefits would have been equivalent to a one-time payment of $2,300 and $600 monthly in today's money. I've found out about all these numbers by obtaining a copy of his service records from the National Personnel Records Center archives. If you earn that kind of money as a 26-year-old, you are considered rich.

(  For readers out there who think that first generation immigrants like me are just here in the states to enrich ourselves at the expense of robbing natural-born Americans of their jobs. Please be aware that some of us are descendants of people who actually fought for your freedom. Admittedly, losing WWI probably would not have cost you your freedom, but you get the point  ;)

Meeting my poor dad

Mom may have lived a very comfortable upbringing, but like everything else, it didn't last a very long time. At age 24, she was swept off her feet by my father, a struggling law student. They fell in love and got married, after a brief engagement. Dad eventually ended up impregnating her, not once but nine times! By the time the last baby came out of her womb, everything was 'perfect'-- it was me that came out last.

My father grew up as the only child of a widowed mother who barely graduated from elementary school. His sister met an unfortunate accident when she fell down the stairs and died later of a brain hemorrhage when they were both very young. He often recalls attending his elementary graduation wearing a girl's shoe as at the time he had no more workable good shoes but merely sandals. It was this lonely and miserable upbringing that my poor dad experienced that I believe led to his unstoppable desire to procreate.

Thriving careers

He managed to support himself first by doing the household chores for relatives in exchange for a meager salary. Eventually, he landed a job in Manila as a typist, messenger, and janitor for his congressman, Don Quintin Paredes, who ended up becoming the 5th Senate President of the Philippines. My father's employ in the law office paid off. He started obtaining his law degree. Over time, through sheer hard work and determination, he passed the bar exams, and he eventually became an associate lawyer in the firm.

Meanwhile, my mother became a government employee in the Manila Central Post Office (one of the heavily bombed buildings in the Battle of Manila during World War II) after a brief teaching sprint. There she worked for 4 decades, working her way through the ranks until she became the head of the registry section supervising close to a hundred employees.

They both may have had very good jobs, but those were not enough to support a fast growing family, especially if you're married to a womanizer. Not to discount my dad who is a great provider, but it was my mom who made the wise financial decisions.Without my mom, we would not have survived financially. Sadly, my poor dad's idea of investing is buying lotto tickets.

The real head of the household

It was the wisdom of my rich mom who had the foresight to invest in real-estate. It was her that pushed my dad to save up. It was her who pushed for paying for everything in cash even if it meant literally eating rice and beans for dinner. Mom and Dad bought rental properties in various places in Manila to the point that they had over 9 fully paid rental properties in their portfolio, including our primary residence, which was also partly rented out. Each property probably had 4 to 8 rental units for somewhere around 50 units in total. It was the income from these rentals that fed us. It was the income that paid our tuition fees.

It was the wisdom of my mom who pushed my father to start his own law practice. In the early 80s, my father was at the point of his career where he had most of the connections needed to start his own law firm. Working as an attorney in a lucrative patent and trademark industry, most of his clients were big companies from all over the world. So he rarely had to meet clients in person. At the peak of his career, he was making tens of thousands of U.S. dollars while living in a relatively low cost-of-living city of Manila. With the real-estate income already in place,  the income from the firm was used mainly for travel related expenses to different countries to attend related industry seminars and conventions.

On her deathbed

My mom died in 2007 of liver cancer. On her deathbed, my father tearfully confessed that he fathered another child out of wedlock, a 15-year-old boy. This was in addition to 2 other siblings we've all known, cared for, and accepted as part of this ever growing family of ours. Not sure if she felt any emotional pain at that point, she may have very well been desensitized to revelations such as this. One thing for sure, she will always have a special place in my heart.

Happy Mother's Day!

Monday, February 13, 2017

Your spouse will have the greatest impact to your financial well-being

With Valentine's Day just a couple of days away, I'm beginning to feel the pressure to come up with something really special for my wife. Traditionally, it would be fresh flowers-- a bouquet of red roses to be specific.

In the past, I hated buying flowers. I've always thought of it as a big waste of money. So to minimize the cost, I bought them at Walmart. If you're as frugal as I was, just don't tell her where you are buying it from, or it will quickly lose its luster.

In fact, when my wife and I started dating I bought her fake porcelain flowers reasoning that they can last forever. The idea that one would spend $50 on a rose bouquet that won't last more than a few days is beyond me.

For single lads out there, I'm now convinced that the bouquet of flowers that you buy on Valentine's Day may very well be one of the best investments that you're going to make (next to an engagement ring)... IF AND ONLY IF, you are giving it to the right woman.

Unless of course, your only intention is to get laid.

For single ladies out there, be aware that accepting a bouquet of flowers from someone you like may become a prelude to a romantic engagement that more often than not lead to an actual marriage. And that's the scary part.

For both parties, be forewarned...


This is an obvious point for gold diggers. But I'm not talking about marrying for money. I'm talking from the point of view of an investor. If you're looking to marry someday, the most important thing that you can do is to pick your spouse carefully.

Happy Valentine's Day.

This is an actual picture of the rose that I gave my wife last year.

Saturday, January 14, 2017

Why you should save for your kids' college education

One of the financial concerns of every couple is saving for their kid's college education. Some end up making excuses why they shouldn't, among them:
  • You cannot borrow for retirement, but you can borrow for college.
  • It promotes responsibility-- they'll work harder academically.
  • I don't have much money left after expenses.
Should parents save for college? You're going to hear a strong opinion from me...

My kids playing with the next door neighbor when they were younger.

Top excuses parents make

"You cannot borrow for retirement, but you can borrow for college."

It's true that you should prioritize your retirement; the kids can always borrow. But do you really want your kids to get into debt??? I don't and I'll do my darn best to help them pay for their education. Don't be selfish.

Assuming that you're debt free (besides the house), you should contribute the bulk of your savings into your retirement account AND still make an effort to save some for college. I'm not saying that you should be responsible for 100% of the costs but at least make some effort.

Times are different, the cost of education is getting higher than ever. Your kids will need as much help from you as possible. You brought them into this world, so you bear some responsibility in making sure that they have a bright future.

"It promotes responsibility-- they'll work harder academically."

Children learn from their parents. They are an extension of their parents by their words, thoughts, and actions. How then can not saving for college promote responsibility??

In fact, it might have the opposite effect-- it can promote your irresponsibility.

Would they work harder academically if they're paying for it themselves? Probably yes. Does this mean that they'll perform better than when you're paying for it? No.

By saving for college, you instill in them the responsibility to do the same for your grandchildren and the generations to come.

"I don't have much money left after expenses."

Unfortunately, the people who make these excuses are the same people who overspend on things like cars, vacations, and mindless home renovations.

In most cases, all you need to do is to tighten your budget. There are countless of ways you can save extra money:

driving a cheaper car, changing your own oil,  shopping for cheaper insurance, avoiding junk food, brown-bagging your lunch, getting rid of the cable, buying food in bulk, taking advantage of coupons, avoiding overdraft fees, not paying ATM fees, not buying extended warranties, buying refurbish electronics, skipping the latest model, mowing your own lawn... whew!

Either that or get a second job.

You should and you should start before they're born!

The problem is that parents start saving 2 or 3 years before their children go to college when time is not on their side.

Just like your retirement savings, the earlier you start, the more time your investment will grow. This is especially true if the funds are invested in stocks.

In my case, I started a 529 account for each of my kids as soon my wife told me that she's pregnant. As a result, we now have over $100,000 saved for my 2 children.

The results speak for themselves.

Savings for Madeline (8 years before college)

Savings for Marco (11 years before college)