Skip to main content

How Investing in Equity Funds Curbed My Spendthrift Tendencies

The Dollar Stretcher

I admit I used to overspend as a teenager. Eventually, I started helping out in our family business, made some bad decisions typical of young people, and I admit I've got the tendency to overspend. I started to invest in time deposits and invested in treasury bond (which is loans for government and retail companies), and I was initially discouraged from stocks because of the volatility. My first bond was sold and I decided to reinvest the money. Right now, I wonder what I'd do with the money when it matures plus I still have a long-term negotiable certificate of deposit (LTNCD) due two years from now. I thought about the bear market and realized Warren Buffett would advise buying the dip with an index fund. Before that, I decided to get into AXA's Chinese Tycoon Fund which invests in blue-chip companies by Filipino-Chinese businessmen (read here). I wanted to increase my coverage but found out my short attention span can be a real killer.

Before the pandemic, I got the AXA Chinese Tycoon Fund. Having to lay aside PHP 3,000.02 per month made me think to focus on my needs than my wants. It would be a good idea to focus on getting my needs over my wants. I do want a lot of stuff but I've got to be careful with my impulsive spending. Laying all that aside made me think about long-term investing. Sure, I've got a 2.5% per annum fee (due to active management is also involved). However, it's for the long-term and the stock market may go from bull to bear and bear to bull within a given timeframe. 2023 would mark the fifth year of my AXA Chinese Tycoon Fund. I decided not to pull it out because the PHP 3,000.02 allocated per month during a bear market means there are more units bought than during a bull market. Still, the principle is cost averaging with AXA to minimize losses. Though, I want to also do value cost averaging--that is buy a bit more during a bear market and buy less during a bull market. 

I wanted to do value averaging and I felt helpless. Fortunately, I decided to get GCash so I could order some food. It's kinda stupid really but GCash has the GInvest feature. Sure, I want to open Seedbox but I think GInvest will do for now. GInvest allows certain products such as stock index funds, feeder funds, and bonds. I decided to invest small amounts to rebuild my investment muscle. However, I realized that it might be better to lay aside PHP 1,000.00 to PHP 2,000.00 per month (or quarter) to the stock index funds and the feeder funds. The Philippine Stock Index Fund is more on passive management while the Philippine Smart Equity Index Fund combines the best of active and passive. The ATRAM Global Consumer Feeder Fund and the ATRAM Global Technology Feeder Fund will allow me to invest in global stocks without having to open an account abroad.

The principle of investing is to invest what you don't need now. I still find the idea of investing only what you can afford to lose to be very self-defeating (read here). I prefer to think about investing in what I don't need now. In short, I'll keep some emergency cash on hand, maybe invest only every quarter, or not invest at all (for a short period especially during a bull market) if the minimum has been met. I would think the best way to do it is that some of the money I set aside for wants gets invested. Money set aside for needs should stay. What happens is it becomes amusing to see myself trying to make every penny last. Fortunately, I don't desire luxury goods which is why my spendthrift tendencies aren't that bad. Still, I want to curb them as much as possible.

The objective here so to be thrifty, not stingy. That's why I wrote an article where I explain why being stingy isn't a good thing (read here). The aim isn't penny-pinching either. I want to achieve a thrifty lifestyle. Buying those equity funds when I can (and holding on to my AXA equity fund) has been helpful in making me reject a luxurious lifestyle. It's been one of the ways that one could stop spending on what doesn't matter to focus on what truly matters in finance. 

References

"Buying the dip: Is this a good strategy when markets are falling?" by James Royal (May 26, 2022)

"Philippines Feeder Fund What It Is And How To Invest"

"What Is an Index Fund? An Easy Way to Enter the Stock Market" by Kevin Voigt (March 20, 2021)
Labels:

Popular posts from this blog

Is Jollibee "Invading" South Korea Now as It's About to Acquire 70% of Shabu All Day?

I must confess that I find this new rather hilarious . It's because the word shabu is often associated with drugs. All the while, shabu shabu is a Korean delicacy! Well, I'm going to say that Jollibee Foods Corporation has now become a multinational buyer . Jollibee acquired 70% of Compost Coffee back in 2024 . This year, Jollibee as a multinational corporation is now acquiring Shabu All Day for PHP 5.1 billion pesos. Is Jollibee checkmating South Korea or is the Philippines conquering South Korea not just by OFWs but als through Jollibee? The answer is still no. From GMA News , we can read this article by Jon Viktor D. Cabuenas: Under the deal, Shabu All Day will be consolidated into Jollibee Foods Corp.’s (JFC) financial statements immediately upon completion of the acquisition for a total consideration equivalent to KRW127 billion. Completion of the transaction is subject to closing and financing conditions. The acquisition is expected to lead to a 2% jump in revenues, incre...
Read more

The Tragic Windfall of the Late Flor Contemplacion's Family

PEH.ph Last year, I wrote an article talking about Flor Contemplacion crybabies spreading fake news for 30 years . I noticed that the movie could be watched for free on YouTube (which is one hour and 52 minutes long), and the one that you had to pay for via rent or personal soft copy ( which is two hours and two minutes long). I was looking into the film and realized the "for free" version lacks the exaggerated water dunking and electrocution torture scene, which I believe is available, which is a ten-minute difference. I remember seeing the old version where Flor was tortured by Singaporean police via water dunking and electrocution, to get an answer out of her. The famous line by the late Nora Aunor was, "I did not kill anybody!" It's 31 years, and I don't expect the fake news about Flor to stop just because  it's past 30. No, fake news is that hard to kill even in the digital age. It reminds me of the fate of Flor's sons , where one of them, Sandr...
Read more

Why Being a Miser Isn't the Right Way to Do Business or to Live Life

Sometimes, people can confuse frugality with being a miser. I think about a couple of times when I watched Spongebob Squarepants back some time ago and getting irritated at Mr. Krabs. Unfortunately, there are some people who are so obsessed with money (or money comes first) that they end up becoming misers. As I was watching Spongebob while studying to get my bachelor's degree in business administration--I felt that the Krusty Krab model won't work well in real life. I mean, I tend to eat at Jollibee almost daily since I was studying in the University of San Carlos-Main Campus (USC-Main). As I was eating there--I thought would have Tony Tancaktiong build Jollibee as an empire if he was a miser? Mr. Krabs ran his Krusty Krab on a miserly mindset--just one cook and one cashier. Mr. Krabs would even artificially inflate prices just to get more money. In real life, Mr. Krabs should go to jail. Drawing the line between being thrifty and stingy It's often easy to confuse both of ...
Read more

Helping Others is Good But Not to One's Own Expense

I advocate for helping others. I believe in helping others but there were times I overdid it. One time, I gave up so much that I had to be stopped. I was told, "If you gave everything now, how can you help others later?" I would donate some sums here and there, without thinking much. I'm not going to write them all. Some of them left me good while others left a bad taste (and a bad record) for me to endure. Sure, I want to help people but I tend to overlook the consequences. Some of the bad habits I had in the name of helping others are like: Being too generous with buying with credit. Eventually, I lost a lot of money which was never recovered . Some seasoned entrepreneurs may admit their own falls including the credit trap pitfall. Being too willing to give a discount without thinking about how it'd affect profits. Sure, a cheap price can draw people near. However, there are times when the prices of goods and services need to be raised to keep a business running. I ...
Read more

Bongbong's Story of the Little Piaya Store That Could

It's been some time since I did a food review, right? As of right now, I feel like I've been burdened not taking Hotel & Restaurant Management and chose Business Administration instead. Both departments today are under the School of Business and Economics (SBE) at the University of San Carlos (USC).  Having been a fan of almost everything that they can offer to customers--I decided to do some research. I'm not surprised that its owner, Reynaldo B. Villan Sr. aka Bongbong. The timeline from their very own website shares the humble beginnings of Bongbong or Villan Sr. Right now, you can check all their branches here . The humble beginnings of Villan Sr. (I'll use this one instead of Bongbong to avoid confusion with Philippine President, Ferdinand R. Marcos Jr. who goes by that nickname) aren't surprising. I've read how Jollibee was the little bee that could. Tony Tancaktiong wasn't born wealthy and had to face the challenge of foreign food companies. Vill...
Read more