Life is all about choices.
When you want to go somewhere else, like for instance in Mindoro (this is my Grandma’s favorite place here), you have the option of taking a bus and ship to go there that will take you approximately 12 hours. But if you are in a hurry, you can simply ride a plane that will bring you to Mindoro for only 45 minutes. Why I am saying this? How related is this in growing money?
If you have different choices in going to your favorite destination, same applies to growing your money. There are a lot of “investment vehicles” available and all you have to do is to choose which of them will make you achieve your financial goals.
One financial goal you may think of is “How to make a million?” For example, you have finally decided to start investing now. Every month, you consistently save 1k and put it in an investment vehicle that gives an average of 10% a year. It will only take 23 years for you to have a million pesos.
You might asked, “Jacqui, where in the world can my savings become a million?” Simply because of the power of compounding. It was Albert Einstein who said, “the greatest magic in the world is daily compounded interest”. Your money’s interest earns interest still earns interest and so on. Just what I mentioned in my previous article—because money doesn’t sleep, take on leave and it grows over time.
You can just imagine if you put your savings in the bank which gives you 1% on regular accounts and 4% on time deposit with taxes not yet deducted, your money will lose its value.
The table below shows the “comparative study” between the three types of investment vehicles with their corresponding annual interest rates. Imagining yourself consistently saving 1k a month for 25 years. Your money will grow like these (in pesos):
Your next question may be like this, “How can I invest in mutual funds?” You can visit, http://www.pifa.com.ph for a complete listing of mutual funds in the country. Or contact:
Jacqui Noynay (Licensed Mutual Funds Representative)