The basics of cashflow

THE BASICS OF CASH FLOW
From unknown author

There are those who e-mailed me asking about the basics of cash flow. I'm really sorry that I assumed everybody already understands it. Anyway, by demand … here it goes…

May isang bata… joke lang..

The basic is. What pattern do you see if you will get a P100.00 bill and monitor where and how it is transferred from 1 possessor to the other? How does it flow? The pattern for a typical Pinoy is.

You earn from your work, you spend it on food, gadgets, clothing and other basic needs. Before you reach the next payday, paubos na yung pera mo. But that's ok payday is just a few days ahead and it doesn't matter if I run out of money, I am expecting money again any time soon.

This cycle goes on and on and you make some sidelines or create other ways to earn but it seems that money was never enough. (I am tempted to explain further pero usapan… basics lang).

So you can't leave the job that you have because a week without work would affect the cash flow you have to support your family and needs. As much as you wanted to accept another job, the gap would make you pay less for a couple of days, which makes you a slave to your boss.

At least, you have a job to support your needs.

So to illustrate…Cash is flowing inside your pocket.

Years have gone by doing your monotonous routine.

Question… what if you get fired? Or you were forced to retire because there are new and younger people ready to take your place. What would you do?

As an OFW, Makati Executive, Top Salesman, Engineer, Attorney, Teacher, etc… What if it all ends? The sweet cash that enters your pocket every 15 th and 30th suddenly comes to a halt.

There are two things you can buy with your money… An asset and a liability. To describe each... An asset brings money inside your pocket; a liability takes money out of your pocket. Another way to see, it is that an asset if you buy one, will bring the money you spent for it back to you 2 or 3 folds. A liability, when you buy it will not give your money back at all.

Sa ilocano… idjay ti kwa… djak maawatan… (joke lang po, seryoso na kayo eh…)
Sa madaling salita… kapag asset, maibabalik ang pera , pag liability, goodbye sa pera…
Ang problema kay JUAN DE LA CRUZ, habang may trabaho ipon ng ipon at bili ng bili ng liability!

I have seen OFWs get back to the country with gold chains at kung pwede lang limang shades ang isuot ng sabay-sabay gagawin nya eh… dvd, component, jackets, clothes, inuman, pulutan, party, pabango… hindi na makalakad sa dami ng bitbit…

At s'yempre mga empleyado natin dito sa bansa na lingo-lingo bago cell phone at mags ng kotse.. hindi na nga magkasya ang damit sa aparador, tapos pag umaga sasabihin…. wala na akong maisuot.

Guys, esep-esep… what you bought… will it bring money back to you? I know what you have in mind… you have to enjoy what you worked hard for. That's right, but think of something that will last… think of your future.

I have seen the worst of people who were abogado de kampanilya, executive secretaries of top rank business men, people who worked for big companies, earned a fortune and got a big retirement pay by the millions… Now…. Wala na.

Why? Because of their cash flow… went in… went out.

I need not to mention basketball players, actors, singers, etc… Check what is their career path… next after acting, singing and playing… POLITICS. Kasi, 'yung million na kinita nila, puro liability ang binili.

Going back… all the liability they bought, ibinenta ng mura! I'm wearing a gold chain now, which I got from a seaman… he bought it for P35,000 and sold it for 8,000 to me. Hindi po asset ang alahas! Bakit? Totoo na tumataas ang value n'ya pero kapag gutom ka na, kahit palugi ibebenta mo! (wala bang aaray?) Cell phones… dvd players etc. pati bahay at kotse… that's the cash flow of most OFWs…

The question is … "WHAT IF THE INCOME STOPS?"

Sa Pinoy, ganito: anak… mag-aral kang maigi, at pag tanda namin… ikaw na bahala sa amin ha…. Hindi po ba maling-mali…

You have to establish something today that will take care of your future.

Teka, teka… eh ano ang dapat gawin para hindi mangyari yan?

You must create a source of income that will continually make money flow inside your pocket. Start a business! While you are working as an executive or an OFW, or a professional… START A BUSINESS and MASTER that business till you get out of that company. Para kapag tumigil ang income mo sa kanila… may susuporta pa din sa iyo hanggang pag-tanda mo!

Now don't tell me to invest my money on pensions and plans… NO WAY! Narinig n'yo na siguro yung …. Naku ayaw ko na magbanggit…. 'yung mga nagbayad at hindi nakapag-claim… sila pa ang dinimanda at nag-piyansa!!! HUWAG MO I-ASA ANG PAGTANDA MO SA IBA! GUMAWA KA NG SARILI MONG BALON NG PERA! KAHIT MALIIT PA 'YAN, SARILI MO AT HINDI KA AASA SA IBANG TAO…
Imagine yourself when you reach an older age… (aruy ko,,, baka yung iba sa inyo about that age… tabi tabi po…Ako po sa mga nagtatanong… I'm 37 years old. Naabutan ko pa si Michael Jackson at hinele po ako ng nanay ko sa mga kanta ng hagibis…). You have money that the company gave you as your retirement pay… what will you do?

You can consume the money till your old… eh kung hindi umabot? Masamang damo ka pala… at hindi ka kaagad kinuha ni Lord. Eh pang age 65 lang yung naipon mo na budget.

Or maybe, you can start a business and use the money for capital… Kapatid… 9 out of 10 businesses, FAILED… yung isang magsa-succeed, gagayahin pa ng kapitbahay mo instead na mag-franchise sa 'yo… think! At age 50, you are struggling trying to make a business work! What if it fails?!

Eh ano nga ba ang sagot?

The answer is, stop buying liabilities and instead buy assets now. I don't care if it is a banana-Q store, balot, ice candy or a sari-sari store, etc… start now! Because, your experience here will teach you what to do in the future. It's so hard to struggle in business when you are 60 yrs old.

You have to create a source of income separated from the source of income from your work. That when the time comes that you have to stop working, you will have your own source of money! Create assets, start a business that will be there to support you and your family. I AM NOT TELLING YOU TO QUIT YOUR JOB! I'm telling you to start a business while you're working and stop spending your money on liabilities and start putting them on assets!

Ang pera kapag pinambili mo ng LIABILITY… hindi na babalik… ang ASSET… BABALIK.

Teka… masama ba bumili ng mga magagandang gamit? Hindi! Siguraduhin mo lang na ang pambili mo nun ay galing sa asset mo. The business has to be prioritized! Mawalan ka man ng trabaho, may negosyo kang palalaguin.

If before, nabubuhay ka naman ng iisa sapatos mo, huwag mo baguhin 'yun… dati, nagdyi-jeep ka lang… 'wag ka na munang mag-FX…

Create assets and lessen liabilities. Invest and learn now… mag-negosyo!

Eh anong negosyo? Any, as long as you think it is work and doable! I am still looking for partners for my HOME MASSAGE SERVICE! SPA MAGIC! And my business CAR MAGIC is still franchising… (joke lang … baka sabihin nyo nag pro-promote lang ako eh…But I AM PROUD TO SAY THAT ALL MY BUSINESSES ARE ORIGINAL AND ALL ARE GRAND ASSETS!

I started all my businesses with a very small capital. If I used that money to buy a gadget, new shoes or any liability… baka wala lahat ng negosyo ko at wala na akong makain ngayon.

Again, I hope that this BASIC CASH FLOW article helps…. I wish all of us become financially free!

Apophis risk not increased: science fair judges, world media screw up big time

First the story appeared on April 4 in Germany's 'leading' tabloid ("I have calculated the end of the world ... and NASA says, I'm right"), later in more serious papers ("Nico and the end of the world") - and today, thanks apparently to an AFP story where the writer hadn't found it necessary to check anything, it has taken off around the world. Alas: it's absolute nonsense! The claim is that a 13-year old German schoolboy "discovered" - while working on an entry for a major German science competition - that the 2036 impact probability of asteroid Apophis is not 1:45,000 as the NASA calculation says but actually 100 times higher. Because during the 2029 approach the asteroid would hit a geostationary satellite and be deflected into a much more dangerous orbit. The newspapers also claimed that this boy not only was awarded several prizes for his paper but that NASA had "conceded" that he got it right and they were wrong. We're all doomed, right?Well, here's what NASA's NEO guru Don Yeomans told this blog yesterday: "We have not corresponded with this young man and this story is absurd, a hoax or both. During its 2029 Earth close approach, Apophis will approach the Earth to about 38,900 km, well inside the geosynchronous distance at 42,240 km. However, the asteroid will cross the equatorial belt at a distance of 51,000 km - well outside the geosynchronous distance. Since the uncertainty on Apophis' position during the Earth close approach is about 1500 km, Apophis cannot approach an Earth satellite. Apophis will not cross the moon's orbital plane at the Moon's orbital distance so it cannot approach the moon either." And here's how one of the German scientists mentioned in the first story, celestial dynamics expert Frank Spahn from Potsdam University, explained events to this blog today: "I indeed had contact with this engaged boy - he asked me which perturbations/forces determine Apophis' orbit and especially during the close flybys. You know that I deal with kinetic theory & celestial mech. in the context of planetary rings, preplanetary disks etc. I explained him the 3 and 4 body problem and gravitational interactions in general. He did not tell me about his idea to consider a collision. This was in January or February. The next time when I heard of him was in in the boulevard journaillie "Bild" - together with my name.I asked him to meet me (last Friday), he told me about the asteroid - satellite collision thing (after I asked him how he calculated and "corrected" the NASA result). Then I showed him at the black board about the extremely small collision probability (frequency) with such an object. Seeing the arising problems I attended the set of [German TV news station] N24 and explained the leading responsible person that I appreciate the engagement of that young student but simultaneously I express that one has to mention the low probability of such a collision plus expressing that this is not a correction to NASA. The filming session went on and I had to leave for another meeting. The I saw yesterday that nonsens in TV - and I am shocked. By the way - I haven't seen that paper and the work sofar, Nico told me that his computer disk had a virus so that only hard copies are available which are with the referees of the contest at the moment. So - I do not know how he could have won the competition, obviously the referees were no experts."Nor were the writers for the German newspapers or AFP - none of which bothered to ask NASA directly or just consult the impact risk page for Apophis. This is clearly the most used and abused Near Earth Asteroid in many years: Still called 2004 MN4 it briefly reached a record high impact probability for 2029 in late 2004 which quickly evaporated (as always in these cases - so far) when radar data nailed down its orbit in early 2005. And in the following months the remaining impact probability for 2036 also continued to dwindle, to the present 1 in 45,000: You can follow the real science - and the triumph of radar astrometry - on this dedicated NASA website. Which certain Jugend Forscht judges and journalists should have consulted, too ...