Kerygma: An Interview by Bo Sanchez
  • Save the Right Way, Not the Wrong Way
  • I'm Finally Debt-Free

We met at a most unlikely place – inside an airplane. I was bumped up to business class and he was seated right beside me. Since then, Jose Enrique (Joen) de las Peñas became my mentor in investing.

Joen has a mission: to change the adage that "the rich get richer and the poor get poorer." He believes that "the average person, even the poor, has an equal chance to become wealthy if given the right information."

Joen certainly knows what he's talking about. He is a registered financial planner and has more than 12 years of financial management experience. He sits as the president and chairman of the board of International Marketing Group (IMG) Insurance Brokers Corporation.

Joen is certainly one guy I learn so much from every time I talk to him.

Bo: I still remember your dialogue. You said, "I like your book." I think you read Simplify and Create Abundance. And then you said, "Can I share some more to you?" In other words, you were trying to say, "You still lack some knowledge." But I truly appreciate all the financial knowledge that you have shared with me all these years.

Joen: That's true. I read a lot of your books. It's always been my dream to meet you so I could tell you a bit more about financial services, about the mission that we do. I know that you can help spread what we know, so it was a good chance to let you know all the things that we know.

Bo: Can you share with us this mission, this crusade in your heart that's been driving you for the past 10 years?

Joen: It's about the statement "the rich get richer and the poor get poorer." Our mission is to change that. The rich get richer, it's good. But the average person also has the right to become wealthy and I know that with the right information, he will have the same opportunity as the wealthy people.

Bo: That's wonderful. So the rich, yeah, they can get richer, so long as they share their riches. But you're saying now that the average person can become rich as well.

Joen: Yes, if the average person understands what the wealthy people are doing, if he understands the right financial vehicles, then there is no reason to be poor. Sadly, the average person focuses on different things while the wealthy people focus on how to become wealthy and successful.

Bo: Can you give some specifics?

Joen: If I ask the average person, "What is the rate of return on your savings?" most of the time he does not know. But ask him about the rate of return on his debt, he'd know. It's always at the back of his mind. But the wealthy people – they know the rate of return on their savings, when it will double, how much their money will be in so-and-so years.

Bo: You know, just yesterday I went to my bank and they gave me this leaflet on new interest rate. I was so shocked – it was 0.75% for a year! I thought it was at least 1%.

Joen: And that's still gross. You still have to deduct 20% withholding tax. What a lot of people do not understand is this: that the bank is a good vehicle for business; but for your own personal savings, there are lots of other financial vehicles that you can use.

Most people think that by saving they're already doing something right. But the fact is, you could save the right way and save the wrong way. And saving the wrong way, at the end of the day, will not change anything.

Bo: That's a very important point. You know, Joen, my role is to give people the capacity to have a vision. I give them the capacity to dream. I remove their limiting beliefs – that I can't do it, that I'm poor. So you're absolutely right. People don't have a vision of doubling their money.

Joen: A lot of people are like that – they do not understand that with a meager rate of return on their savings, they will never have a chance to become wealthy. But I can show you a way that, even if you save P20,000 for six years with a total of P120,000, over the years as it compounds, it can be P9.5 million.

Bo: Wow. So you're saying, Joen, that if the average Filipino can save P1000 or P2000 a month, they can become a millionaire over time? But they need to know how to save, where to save.

Joen: Yes and at the same time they should have a vision where their money is going and how exactly their money can grow. All of us work hard for the money. But eventually if we know how to handle money, money can actually work for us. We can be the boss of our money and not the other way around.

Bo: OK, you're saying, don't put it in a bank, use the bank for business as loans, maybe business loans. But tell us, what vehicles are you talking about that can make one a millionaire over time?

Joen: One of the widely used financial vehicles right now, even is the US and Europe, is the mutual fund. In a mutual fund, your small amount of money becomes part of a very big fund. If that fund earns 12% or higher, whatever savings you have there will have an equal rate of return as the whole fund. Many people think that the mutual fund is for the wealthy. But in fact it was created for the average persons to earn equally with the wealthy people.

I look at a lot of Filipinos and they're very focused on how to make money but that's only 50% of the equation. The other 50% is learning how to let their money go back to them much faster.

Bo: That's true. Is it safe to invest in a mutual fund?

Joen: A mutual fund is regulated by the government and managed by a professional person to let the money grow. It's one of the safest vehicles to let your money grow and to have the best rate of return. They have what you call asset allocation. The fund is spread correctly and all that the fund manager does is to think how to let the fund grow. And because of regulation, it's a very safe vehicle.

Bo: I'm sure we could go on and talking about this wonderful topic. One last thing before we end. You said that in the US, 20% of the people there put their long-term savings in the bank, but 70 or 80% put their money in mutual funds already. In the Philippines, it's the opposite. Not even 1% of our people invest their money in mutual funds. And so you have a long way to go.

Joen: Yes, there are a lot of things to be done. But I believed that with the right information we can actually become like the US and there will be more money in mutual funds compared to the regular savings in the bank.

Source: Kerygma June 2008 | An interview By Bo Sanchez

She's one of my financial mentors who taught me the way to financial freedom. In fact, Aurora "Ojing" Osana is the National Marketing Director of one of the biggest and fastest growing financial distribution companies in the U.S., Canada, Taiwan, Hong Kong, Dubai, Barcelona, Milan, Athens, Malaysia, Philippines and other parts of the world.

But Ojing wasn't always the financial whiz she has become today. Like most of us, she also had money problems and struggled to pay one credit card debt after another. Ojing was caught in a cycle of debt that gobbled up all her earnings. No matter how hard she worked or how high a salary she received or what business on the side she established, still there wasn't enough money for Ojing and her family. Then, while visiting a home for the aged and having witnessed the sad condition the old people were in, Ojing came to a life-changing realization. She promised herself that she will not end up this way – old, abandoned and destitute.

Though her current job, Ojing learned the art of earning money, saving it and making it grow the right way. Armed with these tools and having survived a financial meltdown, Ojing embarks on a mission to educate fellow Filipinos on the proper way to manage their finances.

I took all that Ojing taught me to heart and used it in my financial life. I pray that you will, too.

Bo: My good friend, Ojing Osana, and I have a mission – to educate people financially. We want to educate people in their finances because we're financially stupid.

Ojing: You will agree with me that it's a scenario, Bo, to end up like the old people in homes for the aged. To be hones, I don't want to reach the stage na mapunta ako sa home for the aged.

Bo: Ojing, tell me your story. Were you always financially in the know?

Ojing: No, I was so stupid before, Bo. It's different now. I didn't want to touch my savings but I kept on incurring debt through my credit cards. The reason why I work so hard for the money is to buy what I want, to go to places where I want to go. That's all. Saving money wasn't part of my vocabulary before.

Bo: You had a good job before, right?

Ojing: Yes. I was working with an oil company before – taong grasa so to speak. I was handling marine lubricants at that time. It's an international company so the pay and the benefits ware good. I traveled a lot. But at the end of the month, wala pa rin e. The money I earned still wasn't enough. I didn't know where my money went and how much I really earned that time.

I qualified for pre-approved credit cards because of the company I was employed in. I thought that with the credit card, I could just sign and sign for my purchases, pay every now and then. I came to a point where I could afford to pay only the minimum amount due every month. I didn't know about compounded interests applied to the unpaid balance of your bills. Then I realized my debt had piled up and I could no longer pay.

Bo: Just one word to our readers – we're not blaming credit cards and saying it's bad. The credit card is basically a tool, and if you use it well, it saves you from bringing so much money and at the end of the month you have a list of your expenses reflected on the bill. It's a great help in keeping track of expenses. Then what happened, Ojing?

Ojing: I realized what I did was stupid. Then I learned through my present company that there is really a right way of doing things. The company taught me how to spend wisely, save the right way, and make my money grow.

Bo: I've heard so many accountants say that they cannot apply what they do professionally in their personal finances.

Ojing: Exactly. I could balance finances to the last centavo for the company. But ironically, I cannot account for my finances. I guess it's really like that. When I had my financial check up, I realized that I was living way beyond my means.

Bo: how did it feel to have debts?

Ojing: It was like having a nightmare: a nightmare because I could no longer manage my debts. The credit card companies would call me, one after another. It was like having a smorgasbord of demands to pay from credit card companies. I'm sure there are many people who can relate with what I've experienced.

Bo: What then is the best thing to do on this kind of situation?

Ojing: You have to face your creditors. Talk to them and honestly tell them what you cannot pay for or what amount you can afford to pay monthly. You can even apply amnesty so that you can pay off the balance without the interest.

I had to cut off my expenses – talagang walang gastos. I really didn't know where to get the money. So, I put a flower shop in the hope that the business could help augment my income. The business did not prosper because I wasn't a businesswoman to be with. I just enjoyed arranging flowers. There are also many factors to consider in a business. Actually, you need to be on top of your business, 24-7. there were times when I couldn't keep track of the collections because I was still employed in a company while running the business.

Bo: What woke you up?

Ojing: I reached my turning point when I went to a home for the aged like Anawim. I saw how the old people there were being taught how to take a bath using a water hose. I saw that the volunteers did not care enough for the elderly. I told myself I did not want to end up like this, that after working so hard, I'll just live my old age in a hospice. That's when I applied the X curve, a powerful financial concept. It teaches you to save now, to build your assets and make your money work for you so that you'll be prepared for any kind of emergency and most of all your old age. The X curve is really your financial life story.

Bo: The X curve really helped me a lot. Sometimes we don't know what illness we have, so we go to a doctor for a diagnosis. It's the same with your finances – you need to go and have a financial diagnosis, look at what's happening in your life and then you'll know what you can do.

Ojing: I started listing down all my expenses. That way, I saw my expenses for the week and for the month. Then I computed my total monthly income and all other income I expected to receive. I realized that my expenses were really more than my income. I also realized that most of my expenses were not necessarily what I really needed. I had to learn how to separate my "needs" from my "wants."

Bo: Wonderful. And then you started saving, you paid all your debts.

Ojing: But you can't pay your debts in one go. You have to do it gradually. Let's put it this way – set aside 20 to 30 percent of you income to pay for your debts.

Bo: When you think about it, some people say you have to be greedy to be a multi-millionaire. Not at all – Ojing is such a wonderful, generous woman even if she has become a multi-millionaire. From a woman who had so much debt, she is now where she is because of financial education. And that's something we want you to experience as well.

Ojing: You don't need luck to become wealthy. All you need is the right information and know the right vehicle.

Bo: You need the right vehicle. There are cars towards wealth. You just have to learn what they are. Thank you, Ojing, for teaching me. It has helped me a lot.

Source: Kerygma June 2008 | An interview By Bo Sanchez