Wealthy Discoveries: January 2011

Wednesday, January 26, 2011

How To Open A Mutual Fund Account

This entry is in response to Shine’s request on how to start a mutual fund account.

I can only speak for the mutual fund companies I have invested but the process is almost the same for all.

For Philequity Management Inc. (PEMI), Click LINK

For First Metro Asset Management Inc. (FAMI), Click LINK

For ALFM (BPI) –Visit any BPI branch and ask about their mutual funds. They will give your forms to fill-out. Here are the various ALFM mutual funds, Click LINK

For Philam Asset Management (PAMI), here's the investment procedure.

1. For Individual or Corporate Accounts:

Investor/s fills the following forms:

a. Investment Application Form (IAF)

b. Client Information Sheet

Investor/s submits a photocopy of any government issued ID.
At most, 3 persons can open a joint account
For Corporate Account please submit the ff:

1. Articles of Incorporation & By-Laws

2. Certificate of Registration

3. Board Resolution, authorizing the investment

4. Secretary’s Certificate w/ Specimen Signature

5. Certificate of Beneficial Ownership

2. Investments can be made through:

CHECK: Check should be made payable to the fund, i.e.,

– Philam Bond Fund, Inc.

– Philam Fund, Inc.

– Philam Strategic Growth Fund, Inc.,

– Philam Managed Income Fund, Inc.,

– GSIS Mutual Fund, Inc.

(For any out-of-town checks or offshore dollar checks received, booking of investment will be made upon clearance of check).

CASH - For dollar cash notes, please provide a copy of the dollar bill serial number or a photocopy of the dollar bills.

3. For investment coursed through BANKS, deposit amount payable to the fund with the corresponding bank account number. Please provide PAMI a copy of the deposit slip and fax IAF & Deposit Slip to fax # 813-6813/18 before the cut-off time, 12 noon. Please indicate name of BDO as recipient.

Note for Faxed Investments: Original Receipts and Confirmation of Purchase (OR/COP) will be released only after ORIGINAL copies of investment forms and deposit slips have already been submitted to PAMI.

Pia’s Practical Tip #4 On Saving Money

Tip #4:

Auto-deduct your savings or investments on a regular basis (e.g monthly, every payday, etc).

Qualitative Benefit:

You are not tempted to spend your money whenever payday comes.

Quantitative Benefit:

If you invest Php 1,000.00 per month, you’ll be able to accumulate Php 16,000.00 per year @ 12%.

Friday, January 14, 2011

Goal #1 - Check!

So much good news this week!

I finally issued monthly checks for my mutual fund investment equivalent to 5%! Increasing my long-tern investment of 10% (at present) to 15% is one of my goals for 2011 and it’s already claimed!

I was planning to postpone it until middle part of the year but after reading this article entitled 5 Secrets of Successful Savers (click here), I felt I had to do it.

In other words, I had to ACT and MOVE!

Here’s an excerpt from the article:
5 Secrets of Successful Savers

1) They started slowly. Overcoming the initial inertia that prevents many of us from saving is often the hardest step. That's why starting by saving just a small amount can get you on the path towards bigger savings. Nicole Mladic, a 31-year-old communications director in Chicago, couldn't afford to put away a big chunk of her salary when she was in her mid-20s, so she started saving 2 percent. A few months later, she raised it to 3 percent, then went to 4 percent, and eventually reached her goal of 10 percent. Today, her net worth is over $90,000.

It’s a great start indeed!

Tuesday, January 11, 2011

Wealth Within Your Reach Pera Mo, Palaguin Mo by Francisco J. Colayco

Francisco J. Colayco is one of my mentors towards financial freedom. I have not met him personally but I can reach him through his books and seminars under the Colayco Foundation for Education.

I read Wealth Within Your Reach Pera Mo, Palaguin Mo a few years back and it is a good book to motivate us towards our goal. It has in-depth discussions on financial independence and makes us understand its importance.

It also shares stories of successful entrepreneurs and how we can learn from their successes and failures.

This is a must read for every Filipino living here and abroad most specially those who want a clear understanding on financial wisdom.

It does not only talk of the basics on financial independence but most importantly, the hows and what can be done.

Here's a summary of Francisco Colayco's Pera Palaguin Commandments for Financial Freedom:

Pay Yourself First
Define Your Financial Target At Each Phase
Stop Spending On Things That Decline On Value
Protect Your Greatest Income Generating Asset: Yourself
Grow With The Economy And Beat Inflation
Trust The Power of Compound Interest
Assess Risks and Options: The Higher the Return, the Higher the Risk
Make Money Work For You
Invest And Diversify
Use The Power Of One: Strength In Numbers

Click LINK To Buy Book Now!

The Power Of Compound Interest – An Illustration

A family member of mine has finally decided to put in monthly investments in an equity fund. She started this January 2011 and chose Philequity Fund.

Actually, she has made initial investments last year but failed to be persistent in investing regularly.

I do understand her situation since she is a new wife and mother so her family is just recovering from major family-related expenses. Any newly-married couple can relate to her.

But for the new year, she finally decided to ACT and INVEST REGULARLY. And she called me to tell the good news! She will put in Php 3,000.00 monthly to her equity fund and issued post-dated checks for the rest of the year.

I am so happy for her! She is finally realizing her goal to become a multi-millionaire someday by letting her money work for her.

I would like to show a chart that will illustrate the value of her Php 3,000.00 monthly investments in the years to come. I showed the same chart to her during one of our sharings on investments and financial freedom.

Year	Age	Future Value Of Investment at 12% per Annum*	Future Value Of Investment at 15% per Annum*
2011	30	36,000.00	36,000.00
2012	31	80,640.00	82,800.00
2013	32	130,636.80	136,620.00
2014	33	186,633.22	198,513.00
2015	34	249,349.20	269,689.95
2016	35	319,591.11	351,543.44
2017	36	398,262.04	445,674.96
2018	37	486,373.48	553,926.20
2019	38	585,058.30	678,415.13
2020	39	695,585.30	821,577.40
2021	40	819,375.53	986,214.01
2022	41	958,020.60	1,175,546.12
2023	42	1,113,303.07	1,393,278.03
2024	43	1,287,219.44	1,643,669.74
2025	44	1,482,005.77	1,931,620.20
2026	45	1,700,166.46	2,262,763.23
2027	46	1,944,506.44	2,643,577.71
2028	47	2,218,167.21	3,081,514.37
2029	48	2,524,667.28	3,585,141.52
2030	49	2,867,947.35	4,164,312.75
2031	50	3,252,421.03	4,830,359.67
2032	51	3,642,711.55	5,554,913.62
2033	52	4,079,836.94	6,388,150.66
2034	53	4,569,417.37	7,346,373.26
2035	54	5,117,747.46	8,448,329.25
2036	55	5,731,877.15	9,715,578.63
2037	56	6,419,702.41	11,172,915.43
2038	57	7,190,066.70	12,848,852.74
2039	58	8,052,874.71	14,776,180.65
2040	59	9,019,219.67	16,992,607.75
2041	60	10,101,526.03	19,541,498.92
2042	61	11,313,709.15	22,472,723.75
2043	62	12,671,354.25	25,843,632.32
2044	63	14,191,916.76	29,720,177.16
2045	64	15,894,946.78	34,178,203.74
2046	65	17,802,340.39	39,304,934.30

*Annual return of 12% and 15% per annum. P 36,000 per year until she’s

50 years old. Projected returns are not guaranteed. The fund can perform

well in some years and poorly in others. Historical performance is not indicative

of future performance. The figures presented here are for illustration only,

with assumptions on the rate of return that can be achieved by the fund over the

long term.

That is assuming she will only invest Php 3,000.00 per month but as she gets older and continues to climb the corporate ladder, she will be able to earn more and hopefully, invest more, thus, increasing her potential returns.

Congratulations and may you continue to ride this journey!

My sister and I...Cheers!

Pia’s Practical Tip #3 On Saving Money

Tip #3:

Use cash instead of credit when shopping.

Qualitative Benefit:

You’ll not overspend. You’ll be able to shop within your means.

Quantitative Benefit:

You’ll rid yourself of credit card charges in the event you cannot pay in full. Savings of at least Php 2,100.00 per year. Computation @ Php 175.00 as finance charge monthly for a Php 5,000.00 shopping spree.