Money Matters

As the budget planner for my family, one thing I learned is the need to be financially wise. Our family has been blessed and we really have to learn how to properly handle those blessings especially on the financial aspect. As of now, I am working my way acquiring knowledge financially and hopefully, one day I can say that I properly made used of and applied those knowledge and eventually work my way to be financially wise. I actually do not believe that money is the root of all evil. Basically and by nature, money is good. Admit it or not, we need money to survive. However, it is the greed for money that serves as the root of evil. Personally, I want to have more so I can also share more. That's actually my goal why I wanna grow financially; to have more so I can share more.

I found this article in the business section of inq7.net. The information is basic but at least it gave me a lead for my quest.

1. Time deposit. You can lock your money in a time deposit for 30, 60, 120 or more days. You may earn interest from two to five percent. Check with your bank.

2. Unit investment trust fund (UITF). This is a fund managed by the trust department of a bank. Money is pooled from several small investors, and the fund manager invests this fund in equities, bonds, or money market instruments. You may potentially earn more than what you could earn in a time deposit, but there is also a risk attached due to the nature of the investments the fund engages in. Depending on the fund manager, initial investments from investors can go as low as P10,000.

3. Mutual fund. This fund is managed by an investment management company. You may potentially earn more than in a time deposit, but be aware of risks involved. Minimum investment can be as low as P5,000.

4. Stocks or equities. If you are more adventurous and like challenges, you may want to directly invest in the stock market. Some stockbrokers accept small retail clients and investments can be made by buying the minimum board lot (number of stocks considered as minimum investment) of a specific company stock. You may earn more than what you could in a mutual fund or UITF, but the risks are higher. Stock prices fluctuate every day.

5. Bonds. These IOUs from companies have a lower risk than stocks, but higher risk than bank deposits. The key is to pick good bonds that are rated high by rating agencies. Interest is fixed over a number of years.

All the above options can make your emergency fund grow. Just be aware of risks involved in higher-yielding instruments. But if you keep your emergency fund untouched for a long time in riskier investments, you will ride out fluctuations and may be able to earn higher returns.

We wish you the best as you prepare financially for your future.