THE MILLIONAIRE NEXT DOOR

If you want to know the secrets of millionaires, I suggest you grab this book — The Millionaire Next Door by Stanley and Danko.  Though, it talks about millionaires in the United States, concepts are very universal that anybody can relate to it. I got my copy from National Bookstore at 20% less (book sale ends by Sept. 28, so i suggest you do your book shopping now for serious discounts)

Going back, the book profiles a typical millionaire in the US. Their background, habits, and outlook towards money.

It may sound like a cliche, but millionaires do “live well below their means”. True millionaires cease the moment to invest and grow/accumulate their wealth than spend it.

There are 2 typres of people — the Prodigious Accumulators of Wealth (PAWs) and Under Accumulators of Wealth (UAWs).  To become a millionaire, you have to be a PAW… you need to live like a PAW and act like a PAW.

There is a simple formula to know whether you’re a PAW or UAW. Your current NET WORTH, should be your ANNUAL PRE-TAX INCOME multiplied by your AGE, and divide it by 10. If the value is greater than your present NET WORTH, then you’re a PAW. I hope by now, you know how to compute your Net Worth, otherwise you can check my previous post about SAL and PSIE.

For example, Person A’s NET WORTH is 1,000,000 (Assets minus Liabilities), let’s find out if he’s a PAW or UAW. (is he truly a millionaire in the making)

ANNUAL PRE-TAX INCOME = 600,000 (50,000 monthly income x 12 months)

AGE = 40 yrs. old

Therefore, (600,000) x (4) / 10 = 2,400,000 should be Person A’s Net Worth to be a PAW.

Since, 1,000,000 is less than 2,400,000, Person A is a UAW.

Just imagine, despite Person A accumulating 1,000,000 (current Net Worth), he’s still an Under Accumulator of Wealth (UAW). Since by now, with his INCOME and AGE, he should have accumulated 2,400,000, only if he behaved like a true PAW, invested and grew his wealth all these years.

To know more about the traits and charecteristics of PAWs, i highly recommend this book. Since the book is based on actual study conducted by the Auhtors, it presents the data with concrete examples and real life experiences, which makes it easy to read and understand.

PSE to Extend Trading Hours in 2009

 

We have the smallest stock market in the region, and we have the shortest trading hours as well. This way, we barely get noticed by foreign investors busy monitoring other markets in the region. With PSE’s proposal to extended the trading hours by 2 hours (until the afternoon, from the usual 9:30am-12nn), this is a welcome news. More trading hours would mean more opportunities for our market to be noticed by foreign investors, and more time for local stock investors to trade.

Hopefully, this encourages more people to participate in trading, and boost our capital market.

Most Filipinos may still be intimated, and believe that stock trading is only for the affluent. But at this time and age, you dont have to be a millionaire to invest in the stock market. With several online stock brokers around, you can open an account with a minimum amount of 25K. If you’re in for the long haul, and thinking about your retirement fund — this is for you.

To know more about it.. Below is the article I lifted from the Inquirer…

PSE to extend trading by two hours in 2009

Philippine Daily Inquirer
First Posted 15:14:00 08/28/2008

 

MANILA, Philippines – The Philippine Stock Exchange (PSE) said it will extend trading by two hours in the afternoon starting 2009 to attract more overseas investors.

“Extending our trading hours will open our stock market to more investments by creating an overlapping link in trading hours with other exchanges,” Francis Lim, the exchange’s president, said in a statement.

“It is also a response to observations from foreign investors who pointed out that since the Philippine stock market is small, they first look at the bigger markets in the morning but by the time they get the opportunity to look at our market, the PSE is already closing, so why bother at all.”

Currently, the PSE only trades for two and a half hours in the morning, from 9.30 a.m. (0130 GMT) to noon (0400 GMT), giving it one of the shortest trading days in the region.

Afternoon trading, from 2 p.m. to 4 p.m., will be introduced next year to coincide with a new trading system, which is scheduled to go live on or before June 30, 2009.

The PSE tried afternoon trading in 2002 but it stopped after eight months because the extended hours, from 1 p.m. to 2:30 p.m., coincided with the mid-day trading break of exchanges in Malaysia, Singapore, Indonesia, Hong Kong and Thailand. Elizabeth Sanchez-Lacson, Philippine Daily Inquirer with Reuters

BOOK SALE

 

Every August or September, most major bookstores have their annual book sale. So, if you’re shopping for books and want a good bargain, reserve all your book shopping during this time of the year. Over the weekend, I went to Powerbooks and National Bookstore, and YES they’re On Sale — up to 70% for some titles, but at least 20% for all International Titles. Great Savings!

So, to all bookworms and book lovers out there, mark your calendar for this annual book sale. If you happen to spend a good amount of money every year for books — this is the best time.

I grabbed several books myself — enough to keep me busy for the next few months. Good Times!