Word from the wise in troubled times

January 25, 2009 by admin

By Tina Arceo-Dumlao
Philippine Daily Inquirer
First Posted 23:45:00 01/24/2009

Filed Under: World Financial Crisis, Economy and Business and Finance
Most Read

IN these days of great economic uncertainty, people need all the help they can get, including sound advice.
And where better to get valuable words of wisdom than from some of the country’s top executives and entrepreneurs?
These leaders share with the Inquirer the best financial advice they have ever received—the kind not mentioned enough in business books, but have nevertheless made a real and lasting impact on the way they handle their money and their business.
The best financial advice I ever got was what my parents taught me—Always live within your means. I grew up watching them live their lives this way and I don’t recall them ever getting into a financial bind.
Having been used to this kind of lifestyle, it has become easy for me and my family to make sure expenses are always less than income. It is a very good habit to always set aside funds for savings and investments before you start spending. Especially if you start saving at a young age, you would be (pleasantly) surprised to wake up one day with a nice investment nest-egg.
As to investing, I follow the good old adage of not putting all your eggs in one basket. That is, allocating your investment funds across different risk classes (from real estate to stocks). Allocation of funds will depend on your financial objectives and risk appetite. Like most people, I am not an expert on this area. This is where trusted and reliable financial advisors of respected banking institutions can come in to help.
I apologize for having such an elementary financial advice - Live within your means and always set aside funds for savings and investments. This advice is boring and definitely not sexy particularly coming from a banker like me. But given the times, it still makes a lot of sense to me.
—Alfonso L. Salcedo Jr.,
President, BPI Family Bank

The best financial advice I got is to start investing as soon as I begin working. The advice did not come from a person, but was actually an insight from my university days. I was studying Finance and Accounting and was introduced to the concept of compound interest. With the magic of compounding, I realized that no matter how little I set aside, it can only grow by the time I would need it for retirement. In my 20s, I would save around 10 percent of my income each month, and when the pot was big enough, I would shift it to investments. I’ve kept this discipline through the years, and now that I’m in banking, I’m happy to be proven right.
More than just ensuring that I will able to maintain my lifestyle well into retirement, this also helps me feel secure about my family’s future.
—Mark Jones,
Country Business Manager, Citibank Philippines

If it’s too good to be true, it is! Unfortunately, I had to learn this lesson the hard way. Three years after college, my friends and I were lured by an investment scheme that promised a 35 percent return monthly. It seemed like such a great opportunity and we were ecstatic when we started receiving interest payments in the first few months. So much so that we put in more money. A year later, the company and its officers vanished into thin air. Good thing for me I only invested my money—some of my friends even borrowed to invest so they were hit on both sides.
I’ve learned since then to take time to fully understand any investment product before parting with my hard-earned cash. The best investment decision you can make is an informed choice. I focus on papers and companies I am familiar with and also patronize as a customer, allocate my investable funds and get out when I’ve realized my target yield.
—Benjamin Oliva, President, Citibank Savings Inc.

If it looks too good to be true, it probably isn’t! I got this advice from a former boss. It helped me look at proposals/deals with a critical eye-avoiding rash decisions/poor judgement due to enticing returns or yields that seem too attractive to pass up.
—Pascual M. Garcia III, President, Philippine Savings Bank

Focus on the key success factor … advice from my father (deceased), helped in terms of staying focused on the fastfood business.
—Tony Tan Caktiong, founder, Jollibee Foods Corp.

The best financial advice I ever got came from the founder of The Body Shop, the late Dame Anita Roddick. Anita said that, “The business of business should not just be about money, it should be about responsibility. It should be about public good, not private greed, the creation of profits with principles.”
This has been a guiding principle for me and our company, helping us become more conscious of the role we have to play. We are in a very special position to creatively balance the financial and human needs of our shareholders, employees and customers, to narrow the gap between principle and practice.
—Emmanuel O. Del Rosario, CEO, The Body Shop Philippines

Probably, the best financial advice I got was from Steven Cheng, CFO for Amway Greater China and Southeast Asia when I first met him at a regional meeting in Shanghai. He said that “on capital spending, give the highest priority to items that will help you achieve a sustainable and healthy market. If physical presence in the market will help you enhance image, invest on it. Sales are just numbers but sustainability is more important.”
Taking his advice, here in the Philippines, we focused our investments on improving our office, distributors’ centers and built the first ever Amway Brand Experience Center in the Philippines where our Independent Business Owners (IBOs) and potential customers can get a firsthand experience of all the Amway products available in the country. We think that employing this strategy greatly contributed to Amway Philippines’ double digit growth for four consecutive years now, and we’re very optimistic that we’ll maintain this trend in 2009.
—Dominador Bonquin, Country Manager, Amway Philippines, LLC

“A premium product is a winning proposition, said Brad Geiser, This has been helpful to me in simple things like choosing the right cheese or pepperoni, to implementing business strategies that ensure CPK customers enjoy a premium pizza experience.” —Archie Rodriguez, President of Global Restaurant Concepts Inc., franchise owner
of California Pizza Kitchen Philippines
The best financial advice I got was from my grandfather Gaw Lam, who started the watch business for our family, that time is essential to financial success. If you have a good sense of time and a vision of where you want to take your financial endeavors, the road to financial success becomes very achievable. And this is probably why working with timepiece brands makes a lot of sense to me, since I acknowledge just how valuable time is.”
—Linfred Yap, Marketing Manager of Urban Time and Kids Watch Central

“Global trends say that there is money in going green. Like most Filipinos, I initially thought green products were more expensive just because they had a higher price tag. But I learned that they can be cheaper in the long run since they cost less to maintain, conserve on energy, and make the home safer for the family.
This convinced me and my company Hunter Douglas—the world leader in energy-efficient architectural products and window coverings—to develop and serve the green building market here in the Philippines. Exploring this untapped market has helped us become number one in the industry.
—Gigi Lapira, President and Country Manager, Hunter Douglas Philippines.

Don’t spend more than you earn, a time-tested adage passed on by my grandfather, which applies to both individuals and companies. This basic principle has enabled our group to maintain its financial stability amid these trying times.
—Andy D. Bautista, President, Shang Properties Inc.

The best financial advice I got was from my late father who said in reference to the stock market that I should invest only what I can afford to lose. And he also said that the best investment I can make is the education of my children.
—Jesus P. Francisco, COO, Manila Electric Co.

The greatest motivation which pushed me to achieve originated from simply lack of funds / finances.
My parents were ordinary government employees. We could not afford to eat in restaurants. We could have new clothes only on Christmas and school openings.
Not having money motivated me to shine shoes, collect and sell soft drinks bottles and rented comic magazines to our neighbors when I was still in the elementary level. In college, I sold business manuals authored by my professor.
This habit of augmenting my finances, saving and always having a five-year plan, setting up goals which I learned from my management degree in college carried on from my personal life, corporate work to my business endeavors and hopefully until retirement.
Through common sense and work experiences I developed habits which I later on realized were the fundamentals of financial literacy.
—Jimmy Gomez, owner, Fat Jimmy’s, 8 Suites Tagaytay

Nanay always tells us “to never put all your eggs in one basket. With today’s Madoff horror stories, she’s right!”
—Cecilia Ramos-Licauco, vice president National Bookstore.

The best advice is to not to listen to your private bankers. All of them have read the market wrong. I have been taking the advice of chartists. Why chartists? Because we are now measuring the level of fear and greed in the market. Occasionally, I consult Vincy Zaragosa, who is based in Paris and runs his own hedge fund; and Rante Aquila, who is also a chartist and uses his gut feel. You also have to make Bloomberg, CNBC your favorite channels. In times like these, understand the market and what you are getting into. Do not take all of what your private bankers say. Many of them are just salespeople selling products they don’t even know.
—Jose Concepcion III, President, RFM Corp.

The best opportunities are found in the worst of crises. But such opportunities exist only if you are prepared to work hard and to work honestly. That was advice from my late dad, Antonio Yu, a businessman who developed condominium buildings in Taiwan and started an electronics business in the Philippines. Andrew Tan also told me something at the height of the Asian crisis in 1997, which I can’t forget—“At all times, you have to act decisively. Do not be afraid to commit mistakes because fear will paralyze you to inaction. Do your best and decide on the basis of facts. Should your decision be wrong, just pick up the pieces and move on. Pour your heart and soul into the company and I will take care of you and be behind you all the way.”
—Charlemagne Yu, President, Empire East Land Holdings Inc.

The best financial advice I received is to spend within your means or, in short, wise spending coupled with save, save and save some more for the rainy days.
—Ramon Arte-ficio, President Canon Philippines.

A very good friend told me to pay all my debts. So since I have been debt-free, I have no worries.
—Vivian Yuchengco, Philippine Stock Exchange

Stay liquid during
a crisis. —Adelbert Legasto, executive vice president, BPI Asset Management

My uncle told me to focus on three things financially: 1. At the end of the day, the bottom line will matter the most. 2. Strive to build a large capital base and 3. Always maintain a good percentage of liquidity in investments.
—Richard Sanz,
Bibingkinitan, T Square.

Always make your cash work for you. Don’t sit on it. Invest it in real estate or a business. If not, you may be tempted to spend it on useless purchases. Advice given by my brother, my mentor.
—Pacita U. Juan, partner, EchoStore

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