What is "RICH" in the Philippines

One of the reasons why I started this blog is to share what I learned about how to accumulate wealth. I regularly read books and other blogs to learn and improve my financial literacy. In order for me to make a sound plan on achieving my financial goals I must first determine specific numbers that I must attain.

According to a study by the NSCB back in 2010, a family who has an annual household income between Php295,000.00 - Php2,400,000.00 is considered middle class while an annual household income above Php2,400,000 is considered rich. If we take inflation into account these values will be an annual household income of Php 340,000 - Php 2,770,000 for the middle class and above Php2,770,000 for the affluent.

The study however does not mention any criteria regarding the age and Net Worth of the person. One method of determining the average net worth required is by using the TARGET NET WORTH FORMULA from the book "Millionaire Next Door". Below is the formula for the TARGET NET WORTH of an AVERAGE ACCUMULATOR OF WEALTH (AAW)


In order to be considered wealthy a person must become a PRODIGIOUS ACCUMULATOR OF WEALTH (PAW) and must have double the target net worth of the AAW.

Philippines UITF Performance March 2014

Philippine National BankPNB Global Filipino Peso Money Market Fund10.36%22.15%39.03%713.92%
BDO Unibank, Inc.BDO Institutional Cash Reserve Fund20.34%41.62%----------------
RCBC SavingsRCBC Savings Bank Peso Money Market UITF30.31%141%155.86%1411.42%
United Coconut Planters BankUCPB Cash Management Fund (Formerly United Cash Management Fund)40.3%131.11%126.28%1211.86%
Philippine National BankPNB Prime Peso Money Market Fund50.29%51.48%48.05%
China Banking CorporationCBC Money Market Fund60.28%101.23%87.17%813.39%
Security Bank CorporationSB Peso Money Market Fund70.28%71.28%146.08%1311.45%
LandBank of the PhilippinesMoney Market Fund80.28%170.67%----------------
Bank of the Philippine IslandsBPI Money Market Fund90.28%13.1%133.2%150.54%
EastWest Banking CorporationInfinity Peso Money Market Fund100.27%81.27%106.95%1112.41%
Metropolitan Bank & Trust Co.Metro Money Market Fund110.27%61.28%58.01%514.65%
AB CapitalAB Capital Short-Term Fund120.25%------------------------
Asia United BankPeso Money Market Fund130.25%------------------------
Bank of CommerceDiversity Money Market Fund140.25%------------------------
BDO Unibank, Inc.BDO Peso Money Market Fund150.23%91.25%67.94%315.41%
Bank of the Philippine IslandsBPI Short Term Fund160.23%111.18%97.02%913.35%
Rizal Commercial Banking CorporationRIZAL Peso Money Market170.22%121.15%77.24%414.97%
Bank of the Philippine IslandsOdyssey Peso Cash Management Fund180.21%150.98%136.18%613.95%
Philippine Savings BankPSBank Money Market Fund190.21%------------------------
Philippine Bank of CommunicationsSignature Trust Fund200.16%160.95%116.46%1012.77%
ATRAM (MAKE TRUST)ATRAM Peso Money Market Fund210.15%------------------------
Sterling Bank of AsiaSterling Money Market Fund220.12%180.61%165.61%--------
Union BankUnionBank Peso Short Term Fixed Income Portfolio230.09%31.82%210.65%215.67%
Philippine National BankPNB Institutional Money Market Fund--------------------------------

How Inflation Affects You

Inflation affects all of us. It affects income, expenses and how we manage our investments. Unless your country is experiencing hyper inflation or high inflation, most of us won't notice its effect immediately. Normal inflation rate is between 3%-5% per year and hyper inflation is inflation rate higher than 50%.  It is important to understand how inflation affects us since inflation affects the purchasing power of our money. The number of items you can purchase for One hundred peso today won't be the same ten years from now.
Historical Philippine Inflation Rate

Inflation according to investopedia "the rate at which the general prices of goods and services is rising, and, subsequently, purchasing power is falling. It is important to understand how inflation works since the purchasing power of your money today won’t be the same in the future.

Should You Rent or Buy a House?

Renting or buying a house both have their benefits and drawbacks. One may be more suitable for you than the other depending on your needs and situation. In order for you to make a sound decision, a lot of factors should be taken into consideration. Aside from comparing the monthly amortization to the monthly rent, you should also take into account other circumstances such as convenience, location, length of stay, lifestyle and maintenance cost.
rent or buy

Bank Repossessed Vehicles March 2014

Below are a list of Bank repossessed vehicles found in Cebu. Every now and then banks auction these cars to the highest bidder. If you are searching for slightly used, quality used cars at a bargain price you might want to check these cars out. 

It is advisable that you bring a mechanic, battery and some fuel to test out these vehicles since some of these vehicles have been in stockyard for quite a while. Be prepared to spend a bit more for minor repairs and replacement parts.

cebu repossessed vehicles

52 Week Challenge

Every year I try to find new ways to improve my financial status. Last January I came across a savings strategy called the 52 week challenge. Although the idea originally came from Life as you live it, I read the article from Kuripot pinay.

The challenge is to save every week with a constant increasing amount every week. Unlike saving a constant amount every week, the increasing amount required allows you to slowly adjust your lifestyle in order to achieve the required amount each week. If you religiously stick to saving the required amount each week, you'll end up saving a huge amount at the end of the year.