The 131,000 Philippine Peso Lesson

I would like to start my blogging experience with my biggest financial problem as of today - credit card debt.

I only have one credit card. ONE CREDIT CARD!!!  It is an HSBC Visa Classic credit card. 





After learning the truth about money and why gold and silver coins will make me rich in the next few years, I maxed out my 63,000 Pesos credit limit. 

Well I used 20,000 Pesos out of that 63,000 Philippine Pesos to do a silver leveraged trade on OANDA which became a TOTAL LOSS!

Note to myself: Only put money you are willing to lose in Paper Markets.

I used the remaining 43,000 Pesos to buy myself American Eagle and Canadian Maple Leaf silver coins.

Now where did the 131,000 Pesos comes into play?

After reading Mike Maloney's Rich Dad's Guide to Investing in Gold and Silver (which is also available in Powerbooks right now) I learned that before a big inflation I should lock into getting a fixed-rate loan so that the increase in prices (and salaries) in the future will take care of the fixed monthly payments on the loan.

So I called HSBC's PayEasy and requested them to convert my outstanding credit card debt of 63,000 Pesos to fixed monthly payments of 28,000 Pesos. This fixed monthly payments scheme will last for four years for a total of around 131,000 Pesos!!!  





As of this year 131,000 Pesos is a huge amount of money but I am convinced that four years from now 131,000 Pesos will not be that big anymore.





Why? 





Remember in 1995 that a movie ticket costs only around 20 Pesos? How much is it today? More than a hundred Pesos! 





While I am locked in a fixed-rate debt for the next four years I now felt the feeling of uneasiness of lots of people who got home mortgages for their houses. Those mortgages had them locked for 20 years while I am just locked for four years. 





Also applying the teachings of Robert Kiyosaki (Rich Dad, Poor Dad), I learned that:

• Don't pay for a house or a car unless you will use it for a for-rent type of business (passive cashflow).
• Don't buy a house or a car unless you have an income (or a profit) from your investment that can give you additional money so that you can buy for these big-ticket items only with cash. 
• Unless you have the excessive cash to buy your own house and that you don't need to take a mortgage, rent a place for you to live in.

So this is my lesson that I think is worth 131,000 Pesos (at least). MBA guys and those who study four years in Harvard Business School will never get this unless they experienced it.


Life is indeed the greatest teacher of all.

About the "big inflation" thing, I think this video will help you understand:

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WARNING: Articles posted in this blog are from my actual life experiences and opinions. These do not guarantee a life of riches, alleviation of poverty, or making the world a better place. I am NOT LIABLE if you follow any of the articles posted in this blog and got poor.





INVEST AT YOUR OWN RISK. YOU ARE RESPONSIBLE FOR YOUR OWN DESTINY.