Stock Rights Offer (SRO)

It is always exciting to learn new stuff about the invesment world for a young person like me who is just starting out. And there are far too many financial terms out there that don't really make sense to me and sometimes can be a bit intimidating. I can admit though that the lack of due diligence to research is one primary factor for this.

Just like the stock rights offer (SRO) of MBT. I've seen a few notification about it from COL Financials before but I just kept on ignoring them. I was clueless how it works until finally I braved to diligently research in the web.

To put it simply, my understanding tells me that SRO is like a promo where the company will sell its stocks at a discounted price for a limited period of time to its existing shareholders initially before it gets offered to the open public.
And there's a limit to how many you can buy depending on how many existing shares of the company you currently hold. The company provides the ratio. For example 1:6 means for every 6 existing shares, you are entitled to 1 SRO share. So if you have 600 existing shares, then you're entitled to buy 100 SRO shares.

When I subscribed to MBT SRO the discount is P20 per share!

Discount for Books in Not-So-Good Condition

I didn't know that I can actually get a discounted price for books which are not in good condition until one time when I went to National Book Store (NBS) to look for Basic Algebra textbook as I was planning to pursue my studies and thinking I needed a refresher for the subject.

I went to the Math section of the bookshelves and after a considerable amount of time surveying the available books, I found an older-looking one which happened to be the last left in stock. The book is not torn or damaged in any way but I just can't categorized it as "good as new." This may be due to it had been there for a while and people come and go picking it up and putting it back on the shelf and was not really bought. As for me, I'm more after the content than the physical condition of the book and I decided the book will be of good use.

So after asking for a newer stock and being told that they didn't have any, the lady attendant told me that I can bargain with the cashier for a discount which I did. I was delighted to receive 10% off the regular price. It was not a big deal but I find it interesting as I didn't know that I can actually do that.

So I told myself that next time I buy and I find another book in the same condition, I will give it a shot bargaining with the cashier.

5 Tips on Doing Groceries

How to trim down on your grocery spending, you ask? Well I have always asked that myself. You see, I enjoy handling my finances and I will always try to find ways to save, and of course this includes learning how to do my groceries practically. So let me share with you what I have learned. 

Doing Groceries 101


1. Compare the prices among different stores. All you need is either your mobile phone or pen and paper to record the prices. And yes, you need to do a lot of recording here. For it not to feel like a strenuous job, you can do one store at a time. Just get all the prices together from different grocery stores and then compare them. It may not sound all that inviting to go from shelves to shelves to canvass the prices but if you really want to become responsible for your finances then do this. Save by knowing where to buy your items at their lower prices.


2. Compare the prices among different brands. After finally choosing the grocery store of your life, the one that offers lower prices, you're now ready for the next step. Let's talk about one thing first though. Are you one of those consumers that have a mentality that when the product costs more, it probably has better quality? Well good for you if you're not, because I am guilty. Some of us were somehow convinced that more expensive items must be better than the cheaper ones, which is not always the case. This may be true to some products but look around you because this does not apply to all. I didn't realize that or even care that I was just buying the brand, until I became financially independent. So why not try to experiment and give the other cheaper brands a chance? You're probably using that more expensive brand now because that's what you've been exposed to ever since. Have that little excitement of exploring those you have not tried out there. Be the judge of the quality and who knows, you may find that they aren't so different from the branded ones.

3. Do the math. Did you always think that just because the item is larger, it probably costs cheaper than its smaller sizes? Unlucky you if you thought so just like I did. Be warned because this is not always correct. And if you're like me, who find it hard to do the mental computation, we need a calculator here. We all know that the grocery items come in different sizes and of courses the prices vary. Let's take the powdered milk for example. So I saw that 320 g costs P106, while the 800 g costs P275. If you wonder how to know which is one is cheaper then get you calculator out. It's easy, just follow this formula: price / unit = price per unit.

P106 / 320 g = P0.33125 per gram
P275 / 800 g = P0.34375 per gram

You see, you can save from buying the smaller size because it only costs 0.33 cents per gram, compared to 0.34 cents of the bigger one.Compute first before ever hoping that just because it was bigger, you're probably saving.

4. Bring your own bags. Most especially when you are buying a lot of grocery items, it is better that you have your own bag ready because the cashier may offer you a plastic bag if you don't have any, and if you agreed, they will charge you for it. I think last time, I was charged P2.00. I learned my lesson. Not happening to me again.

5. Check the printed receipt for any error. I swear, you have to do this.  After the receipt was handed over to you, do your due diligence to "proofread" if it is accurate. Do not let your saving practices be put to waste just because of someone else's error. There are times when the cashier incorrectly double-registers an item and you don't want to pay for that!

There you go. Remember, the cents you are saving today, if put together multiplied by number of weeks, months or years can be astoundingly more than you think

How to budget using sentences?

Some people I know ask me how  I budget my money. Well, I use made up sentences to do it. They help me control my spending and make tracking of my expenses easy. Here's how I do it.

First of all, I've already made myself aware of my usual monthly expenses. Then, I take out the initial from each expense category and bring them all together so I can create an easy to memorize sentence which represents all my expenses. Example: M for mortgage and R for rent. I can make up MR out of these letters to remind myself of the two expense categories.

To get to the point, the sentence I brainstormed to make up and which I am currently using is MR FIGHT GO BLEW CUPS. For sure this sentence does not make sense. Well it doesn't really have to make a logical sense! Just as long as I find it easy to remember, then that should be settled.

Here's what they actually mean to me:

M-ortgage
R-ent

F-amily
I-nternet
G-rocery
H-ealth
T-ransportation

G-asul
O-thers

B-igas
L-aundry
E-lectricity
W-ater

C-hurch
U-tang
P-agkain
S-tuff

So whenever I get my pay, I will just get a pen and paper, write down this sentence and budget my money. With this, I never miss a single expense category. And when there's an uncommon expense, it always just goes under Others category.

The only challenging part for me though is coming up with a sentence that incorporates all of them. Other than that, the rest is history.

Over time though, new initials will be added as I acquire new expenses and I probably have to modify the sentence a bit. It constantly evolves, so to say, in order to fit the new ones in.

What to do with those extra cents?

Well this post is actually a self-realization. Whenever I go to the groceries, I usually get a cent or two for change. What I normally do when the cashier gives them to me is I either refuse to get them or I'll throw them away. Not that I don't save or care about my finances, but I honestly just don't value cents so much thinking they can't even buy me a single candy. Well, I know that's wrong but I just can't care less until recently. This happened when I started to run the errand of paying the utilities, which is frequently done by either my father or my sister-in-law. I would probably be wasting those pennies if not for the cashier from Bayad Center.
I was paying Meralco and Manila Water bills that day. I paid the electricity bill first and the cashier gave me 50 cents of change. I told the cashier to keep them thinking that my Manila Water bill is P1200 flat and no cents anyway.  But the cashier suggested to add those cents to the total payment for my water bill. By that, I avoided wasting them and I will even have a credit for my next bill. And yes, she made me realize how wrong I was wasting them. If I can just keep the extra cents and when it's time to pay the bills, I can add them to my total payment and have a credit in my billing account. Not really a big deal but I found a reason how to value those extra cents from that day on!

BPI, BPI Family Savings Bank and BPI Direct. How are they different?

Had I not looked at it closely and not let my curiosity bother me, I would not have noticed or probably cared what the differences are among BPI, BPI Family Savings Bank and BPI Direct. I know in my mind that I have always wondered why there are these different labels but I did not really take an effort to find out. Like for example there is a BPI Express Teller and there is BPI Family Savings Bank Express Teller. It confuses me why would there be a separate Express Teller for BPI and BPI Family Savings Bank when they are both BPI for me!

Since I am planning to open an account,
I did my due diligence of research and had a quick look at the rates and interest details. Well boy I found some answers to my questions. They may be both Express Teller but the rates and interests differ among BPI, BPI Family Savings Bank and BPI Direct! Like for example, Express Teller of BPI has a maintaining balance of P3,000 while only P1,000 for Express Teller savings of BPI Family Savings Bank! Same with interest rate, one has interest of 0.250% and 0.500% on the other.

But why? How is one better than the other? Why would they offer lower maintaining balance or higher interest rate on one and not the other?

So I called the Customer Service and the pleasant lady I spoke with explained to me why this is so.

I found out that BPI basically is the main company and BPI Family Savings Bank and BPI Direct are subsidiaries. And if you have a BPI account for example, you can only transact with a BPI branch and not with BPI Family Savings Bank branch and vice versa.

I was told that the main difference between BPI and BPI Family Savings Bank is the number of branches they have available. She said that BPI is more suitable for corporate accounts as this has more branches available and can accomodate more business transactions since there are many branches.

While BPI Family Savings Bank is more appropriate for consumer account. It looks like this is the better option for the masses as this gives depositors higher interest and lower maintaining balance. Though this has fewer branches, I was told.

As for BPI Direct, this is apt for those who are abroad (OFWs) because there is no requirement to transact with a physical branch and this can be done over the phone or probably online.

Each type tries to meet the different needs of the customers depending on what type of depositor they are.

I have also read somewhere that the type of account you have may affect the basis the bank will use in processing your loan requests. For example, if you don't really have a business but you got a BPI account which is for corporate, then they may check your business history as a basis for your loan approval.
You can read more about that here: http://www.philstar.com

So technically, these 3 differ when it comes to rates (maintaining balance and interest rate), branch availability, and type of depositor suitability.

My 7 Golden Rules for Personal Finance

Here are the simplified 7 golden rules I always try to incorporate in my everyday life. I keep them in my mind whenever I make a decision to do something related to my finances. They help me control my urges to buy unnecesarry stuff, give me a direction to follow, help me stick with my budget, motivate me to achieve my goals and create financial plan, back me up when I am burnt out from work, and keep my thoughts together in times of anxiety when sometimes the future looks dim. This is like a simple formula that I tell myself to follow each and everyday, and certainly all throughout the course of my financial journey. So here they are:

1. Increase income
2. Decrease expenses
3. Multiply assets
4. Minimize liability
5. Increase cashflow
6. Increase savings
7. Multiply investments

This is probably not all of them because I'm sure I'd still keep adding more as I move along. What I am sure though is that these rules are the core of all the decisions I make. It works with me. Try it. Or probably you have your own.