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Preparing your family for an earthquake

Sourced Rappler  | March 29th 2015

Preparing your family for an earthquake

“Safety must start from homes” .

MANILA, Philippines – Is the Philippines ready for a big earthquake?

With the country surrounded by various active faults and trenches, earthquakes – whether weak or strong – are expected to occur. (READ: Strongest earthquakes in the Philippines)

In fact, a 2004 study conducted by Philippine Institute of Volcanology and Seismology (Phivolcs), the Metropolitan Manila Earthquake Impact Reduction Study (MMEIRS) found out that a magnitude 7.2 earthquake could destroy 40% of the buildings and could kill about 30,000 – 40,000 people in Metro Manila – the country’s business hub and where government agencies are located.

While schools and offices in different parts of the country conduct earthquake drills regularly, these are focused on what the public and the government should do during and after an earthquake. (WATCH: LIVE: #OplanPagyanig: National Earthquake Drill)

But what are the ways to prepare for it?

On Thursday, March 26, MovePH, Rappler’s civic engagement arm, held a #ZeroCasualty conversation on Facebook to discuss earthquake preparedness and safety with guests from Phivolcs and Red Cross.

In a country prone to geological hazards, Phivolcs stressed the importance of preparedness, which should start within the family.

“Safety must start from homes. A family should discuss and have a plan as to what they should do in case of an earthquake,” the agency said.

Here are some ways on how families can be prepared for the “big one.”

  • Know the earthquake hazards in the area
  • Be conscious of the structural integrity of the house
  • Set up furniture and appliances in a way that they will not topple when there is a strong ground shaking
  • Prepare emergency bag/kit for each member of the family

Below is a Phivolcs infographic on what to do before, during and after an earthquake strikes

Earthquake awareness infographic

While earthquakes in general, cannot really be predicted, the risks it poses can be reduced by avoidance through proper planning, according to Phivolcs.

7 Family Rituals MUST DO to Add Meaning to Every Day

By Asha Dornfest | Babble – Thu, 10 Jan 2013

Whether religious or not, many people consider ritual and tradition to be an important (and treasured) part of life. The word ritual has such a serious ring to it, but rituals can also be simple, comforting and fun. And now that we’re past the distraction of the holidays, it’s easier to think about ritual in its less-loaded, everyday form: the little things you can do each day, each week, or each season to insert a pause for reflection or appreciation. Rituals need not be time-consuming (or all that serious) to be special. As long as they’re predictable and important to your family, they will be meaningful. Here are 7 ideas to consider. See if one resonates for you. – By Asha Dornfest

Light a candle

Photo by: Brendan DeBrincat
1. Light a candle
Lighting candles at mealtime naturally quiets things down and encourages reflection. (Unless your kids are toddlers or pyromaniacs, of course.)

 

Give thanks

Photo by: Ali Edwards
2. Give thanks
Expressing gratitude before you eat — such a simple way to pause. No need to include religion if that’s not your thing.

 

Friday night dessert

Photo by: Benny Mazur
3. Friday night dessert
We make Friday nights special by serving a treat. It encourages our kids to invite friends over instead of making plans, and it takes dessert out of the “daily” realm and into the “special.”

 

Change of venue

Photo by: Danny Sullivan
4. Change of venue
Dinner in the living room. Sleepover in the basement. “Predictable variety” is exciting.

 

Weekly family fun night

Photo by: Morgan
5. Weekly family fun night
Movie night, game night, quiet reading night…whatever you enjoy.

 

Scheduled phone calls

Photo by: Julie Corsi
6. Scheduled phone calls
Regular calls to the grandparents or far-flung friends maintains connections and adds rhythm to the week

 

Coming of age rituals

Photo by: Etsy/HouseHoldWords
7. Coming of age rituals
Monthly growth chart recordings, weekly allowance…these small actions let a kid know she’s growing up.

How to form a lifelong bond with your child (while running a career)?

By Cecile Baltasar for Yahoo Southeast Asia | Yahoo SHE – Mon, 6 January 2014
How to form a lifelong bond with your child (while running a career)

Here’s a question many working parents ask: how do you form a strong bond with your child when your to-do list is packed with meetings, errands, and desk work from 7 AM to 8 PM every weekday?

The solution is simple: “Spend uninterrupted time with your children for at least 30 minutes every day,” says Maribel Dionisio, MA, a parenting and relationship consultant at AMD Love Consultants for Families and Couples.

Here are a few tips to help you do just that:

Have daily one-on-one sessions with each child. “When you get home, rest for 20 minutes, then spend the next 30 minutes with one child,” suggests Dionisio. “Take a break for a few minutes, then move on to the next child.” It may take some adjusting at first, but once you’ve established a routine, it will become easier.

“Many parents complain to me, ‘How can I give 30 minutes every day when I have so many other things I need to do?’” says Dionisio. “I tell them, ‘If you can’t give 30 minutes a day, then there goes your influence on your child. How will you get to know your child if you don’t spend time with him or her?’”

To be able to do this effectively, consistently, and without regret, you will have to line up your priorities. And you’ll have to say no to things that are of less concern to you so you can focus on your children.

Go on weekly solo dates with each child, as well. Dionisio says apart from spending exclusive time with your kids daily, it’s also important for each parent to take each of the kids out on one-on-one dates every week (or every two weeks).

But there’s one rule: “You have to do it on a budget of P50,” says Dionisio. That will force you and your child to be creative, and it will teach your child financial responsibility at the same time. Will you have ice cream at an outdoor playground? Kick around a ball in the UP sunken garden? Part of the fun would be figuring out with your child what you can do together.

“This weekly date will be so special to your child because he will have you all to himself,” says Dionisio. “Make sure there’s no interruption from anyone. Turn off all your gadgets. And then just talk with your child: ‘Who’s your best friend? What’s your teacher like?’”

Set a schedule and let everyone know about it. This one-on-one project is a family effort, so everyone has to be in on it wholeheartedly. Both parents have to figure out a schedule for the weekly dates—who takes whom out, how long they’ll be out, etc. Divide your time wisely, especially if you have many kids. Write down this schedule and put it up where everyone in your family can see. This will create a routine, help parents figure out their priorities, and show kids when their turn is with you.

“If you do this consistently and with love, you’ll see the results immediately,” says Dionisio.

With teenagers, you’ll have to be creative. “Your weekly dates won’t be good enough anymore when your kids become teenagers,” says Dionisio. When that time comes, you’ll have to be more creative because you’ll be the one chasing them to spend time with you. Is your teen going to her friend’s house? Offer to drive her over. Does your son need some supplies from the bookstore? Offer to go shopping with him. Does your daughter have rehearsals at school? Pick her up and take her out for ice cream after.

Or, Dionisio suggests, “Just say, ‘I heard there’s this new restaurant. You want to try it with me?’ Let them know it’s your special time with them. But don’t label it a date or your kids will say, ‘Yuck, you’re corny, Mom.’”

Don’t use a cookie-cutter routine for all your kids. Because each child is different, you’ll have to treat them differently, as well.

“Your eldest and your second child probably think in opposite ways,” says Dionisio. “If you put both kids together and force them to do the same things with you, normally, they’ll just end up fighting. Or you might inadvertently give more attention to the louder child. Your alone time has to be custom-fit for each child. Some kids need more alone time with their parents than other kids.”

If your child likes to doodle, tape sheets of manila paper on one wall of your house and paint a mural with her. If your other child likes to read books, take him to the National library on your weekend date, and scour the shelves for interesting children’s books.

Take advantage while they’re still young. Spending time with your children is important, more so while they’re still young.

“It takes three to five years to change behavior,” says Dionisio. “The sooner parents understand this principle, the better. Their positive relationship with their kids will give parents leverage if they have relationship problems with their kids later on. They won’t have to do repair work [on their kids’ attitude] if they work on it now.”

And by ‘working on it,’ that means spending quality (and quantity) time with your kids. If you connect with them this way for their first 10 years, you’ll be able to connect with them for the rest of their lives.

Are you financially ready for a family emergency?

By Mike Aquino for Yahoo! Southeast Asia | BDO Money Matters – Mon, 20 May 2013

To have children, the author Elizabeth Stone once wrote, “is to decide forever to have your heart go walking around outside your body.”

Sleepless nights ensue—once, you were the sole subject of your financial priorities, now you’ve got your spouse and kids to worry about. Even if you’ve got things well in hand now… are you sure you’ve got everything covered, even the emergencies?

While Filipinos are generally not lacking in the sacrifice-everything-for-their-children department, most of us don’t have the financial savvy to properly prepare for a future emergency. “We have this, ‘sige, bahala na, the money’s there’ mindset,” says personal finance consultant Randell Tiongson. “A lot of people start with the life insurance policy, the educational program, all these things, but what about emergency funds?”

Tiongson believes in a certain order to laying the financial groundwork for a family emergency. “There are certain things you have to satisfy first,” explains Tiongson, pointing to your home finances and your debt. Tiongson suggests you do the following, in order:

1. Sort out your finances. “You should spend less on what you make, be able to balance your checkbook, see that you’re spending less than what you’re earning, and generating enough savings. That’s one,” says Tiongson. “If you’re in debt, then the next step is getting out of debt.”

2. Start an emergency fund. “It seems to be uncommon to a lot of us Filipinos,” says Tiongson. “But right financial planning necessitates that you set aside a certain amount of money for emergencies—what we call an emergency fund.”

Tiongson varies the amount he advises you reserve for your emergency fund, depending on your employment situation. “For employees, I’d say three months is the least,” he explains. “If you’re in business, six months to a year. In business kasi, hindi mo alam what’s going to happen.”

Emergency funds are not to be invested in stocks, property or mutual funds. “Ideally, it has to be cash or near-cash,” says Tiongson. “Time deposits are okay, if they can be cashed easily. When you put your emergency fund in, say, a bond fund, there’s that risk of fluctuation: if it fluctuates and it’s the time you need it, lugi ka.”

3. Buy life insurance. For the worst emergency of all—the kind that takes you permanently out of the picture for your kids—you’ll want to make sure they’re taken care of even in your absence. “If you have a dependent, like children, you want to cover that,” says Tiongson. As a rule of thumb, Tiongson suggests you get coverage equivalent to “between three to five times your annual salary.”

4. Cover health emergencies. If you’re an employee, chances are most of your medical expenses are covered (to a certain point) by the office HMO. But if the office HMO doesn’t cover your dependents—or fails to cover them to your satisfaction—the option to buy further coverage is always there. “You buy something that you can afford,” says Tiongson. “Of course, the really good ones are expensive. You may want a bigger room, but can you afford the premium?”

Tiongson suggests you make a priority of keeping tabs on your HMO and insurance premiums. “You also have to track that these things are being paid,” he warns. “Baka mamaya hindi naman bayad ang premium. If it’s not paid, what good is it?”

5. Get a lifeline. Tiongson advises that you use a line of credit—personal loans or credit cards—as a backup emergency fund: not to be used until all other options are exhausted.

“The idea is you start a savings program, but you keep credit handy,” explains Tiongson. “That’s why you should be very careful managing your credit—baka mamaya kung kailan mo kailangan, na-max out ang credit card mo!”

Take note, the order of these items is not interchangeable: the first two items should always be first on the agenda, though not necessarily in consecutive order. “I recommend you do this simultaneously,” says Tiongson. “Fix the way you spend, slowly get out of debt, and at the same time, build your emergency funds before you do other things like buying insurance.”

When Does Buying a Home Make More Sense Than Renting?

iMoney Phils. – Wed, 16 April 2014

Many of us working-age folk grew up in an environment where home ownership is held in high esteem. Our parents and grandparents have instilled in us the importance of owning a home where to raise a family and live out the rest of our day.

My dad, for instance, was able to save up for a parcel of land in his mid-30s, build a house for his family of 11, and then eventually bought a small farmstead not far from our home. Although both houses are projected continuously being improved, he’s now looking forward to his retirement as all of us kids are of working age and have fled the family nest.

The Filipino dream of owning one’s home where one can raise a family is much akin to its American counterpart. Most baby boomers—my dad being one—grew up firmly believing in this philosophy.

But after having watched the U.S. Housing market collapse in 2007–2008, taking the global economy with it, many people of my generation are wondering whether owning A home is as sturdy an investment as our predecessors have heralded them to be. After all, the properties are not liquid assets, they can depreciate, and hot spots come and go. The notion that properties make smart investment has time and again dispelled even by the most respected of economists, chief of which is the Nobel Prizewinning Robert J. Shiller (of the Case–Shiller Index).

money jar The Easy, One Step Guide To Becoming a Successful Long Term Investor

According to Shiller, housing traditionally is not viewed as a great investment because it takes maintenance, it depreciates, and it goes out of style.

“And there’s technical progress in housing… the new ones are better…so why consider it as an investment?” In a nutshell, housing is not really an investment vehicle.

Unless you’re an end-user and wants to buy real estate for your personal reasons.

And to this I agree with Mr. Shiller wholeheartedly. The importance of purchasing a piece of real estate for one’s residence cannot be overemphasized. Living in one’s own home gives families a great sense of security. Sure, there are maintenance issues, but owning lets them sleep soundly at night knowing there’s no landlord who’ll kick them out anytime.

However, because a home purchase in itself is a costly pursuit, buyers are well advised to read these four considerations before making a purchase, even for one to be used as a place for residence.

1. If You Plan to Stay Put for at Least 5 Years

As a rule of thumb, it is generally not advisable to purchase a home unless the property is expected to be owned for a long enough period of time to recoup expenses. If you plan to relocate to another city, say Cebu or Davao, or even overseas, within the next five years for an impending job change, then renting is for you. Or if you plan to start a family soon, then a one-bedroom condo may not be for you. Spur-in-the-moment decisions in home buying may result in firesale if circumstances require moving, and fire sales usually do not work in favor of the seller. As home buying will make the buyer short on liquid cash reserves, he or she must make sure that the property is to be used for a fairly long time.

2. If You Look at the Non- Financial Aspects
The more I read and learn about real estate, the more I realize that the notion of home ownership as a magical path to wealth is just a marketing ploy of the real estate industry to sell more units. Historically speaking, home prices generally barely keep pace with inflation, so why invest in one?

However, there is a nonfinancial aspect of real estate investing, and it is a rather important one. Buying a house makes perfect sense because it gives us stability and freedom. Financially, it may not be the best bet, but there is still a certain level of financial independence that home ownership brings, such as not having to pay for monthly rent, not to mention taking a pesky landlord out of the equation and the eventuality of finally owning the property once the mortgage loan has been paid.

3. If the Price–Rent Ratio Is Lower Than 20

If the housing market’s price–rent (P/R) ratio is lower than 20, then it makes more sense to buy rather than rent. But what is this number and how do you come up with it.

A P/R ratio gives you a rough idea whether homes in your area are fairly priced. All you have to do this is find two similar houses (condos or houses)—one for sale and one for rent—and divide the sale price of the one place of the annual rent for the other. The quotient is the P/R ratio.

For example, there are two identical condo properties (94 sq. meters, three bedrooms) in Penhurst Place in Bonifacio Global City. The first one is listed for sale for Php10 million, while the second is for rent for Php65,000 per month (or Php780,000 per year). If you divide Php10 million by Php780,000, you get a P/R ratio of 12.82.

According to David Leonhardt, in his article published in the New York Times, a P/R above 20 means that the monthly costs of ownership will exceed the cost of renting. A little opaque, but it gives an idea when it makes more sense to buy than to rent. In the case of the Penhurst property mentioned above, it makes much more sense to buy as the monthly rent is greater than what the homeowner would pay on a monthly basis if he buys the property.

4. If You Look at the Financial-Use Aspect

Finally, every home buyer should consider the personal-use aspect when making a purchase. When the house is purchased as a residence, then the property provides both personal-use return and investment return. This means the homeowner can live in the house and avoid paying rent while he or she also experiences gained in the house through appreciation (though appreciation is locked in as the owner cannot use it without selling the house—and lose the place to live in the process).
But in this case the personal use aspect is more important. An initial comparison between renting and buying offhand might favor the former, especially if one takes into consideration the combined costs of mortgage, maintenance, insurance, and taxes.

However, mortgage payment is finite and fixed, whereas rental costs may and will increase. In addition, the mortgage should eventually be paid off, providing the homeowner with a rent-free place to live, which is a great retirement strategy—if the mortgage is paid off at the time of retirement, there will be a reduction in expenses at the same time income falls.

money jar goal The Easy, One Step Guide To Becoming a Successful Long Term Investor

About ZipMatch

ZipMatch is the first comprehensive online community of sellers, developers, brokers, and buyers in the Philippines. It offers everything to make your home purchase easy, from finding the right property and broker to tips on how making money from real estate investment. For more information, visit www.zipmatch.com.

About the Author

Rodel Ambas is a former editor-in-chief of a property magazine, has written extensively for Philippine-based publications, and is now in charge of ZipMatch’s content strategy. He attended the University of the Philippines, where he majored in Development Communication.

How to help OFWs make hard-earned money grow?

By Ellen | VERA Files – Sun, 19 January 2014

By NORMAN SISON

IT is a question that has perplexed government policymakers and academics for years: where has the money been going?

Since 2006, Alvin Ang, an economics professor at the University of Santo Tomas, has been conducting research into the Filipino migrant worker diaspora for aid agencies, the World Bank, the International Labor Organization and other institutions.

“All these years we’ve been receiving a lot of money, but how come nothing is happening. In general, lots are happening in the economy. It has pushed everything up. It has encouraged a lot of investors to come in,” says Ang. “But for the ordinary person who has a family — who is working abroad — not much has changed in his life.”

It is an all-too-familiar story line for generations of overseas Filipino workers (OFWs): a member of the family leaves for better pay abroad, hoping to build a better life for those left behind — only to come home years later with little or no savings.

An estimated 10 percent of the Philippines’ nearly 100 million population work abroad and they are often hailed by the country as heroes. Nearly every one has a family member or relative abroad. Over 3,000 leave daily for jobs overseas.

In 2012, OFW remittances totaled over $21 billion — forming 8.5 percent of the Philippines’ economic output — according to the Bangko Sentral ng Pilipinas. That was expected to rise by at least six percent last year.

To get a perspective of how much money Filipinos abroad have been sending home, imagine this: the 102,000-ton, 1,092-foot long Nimitz-class aircraft carrier USS George H.W. Bush cost $6.2 billion when it was completed in 2006. The Philippine government’s defense budget for 2014 is $1.9 billion.

Ang partly blames the failed attempts of Filipino migrant workers to escape poverty on their lack of financial literacy.

“OFWs are entrepreneurs, in a way, because they are willing to take a risk much larger than a businessman would take. They are risking their families,” says Ang, who uses his spare time as president of the Philippine Economics Society to give lectures and enlighten OFWs and their families on the need to make intelligent decisions on money matters.

“A businessman will take a risk if he knows the full valuation around him. But an OFW is willing to take a risk without any information at all,” says Ang.

He tells of a trip that he made last year to Jordan, where he met with Filipinas working as maids for a mere $200 in salaries. “That is just 8,000 pesos and you are leaving your family for that,” relates Ang, shocked.

He added that it may have been better for them to find work as maids here, where they are guaranteed rights and benefits by the Kasambahay Law, which was enacted last year to improve the lot of domestic helpers.

“What do you lose by working abroad? The social cost is so huge. You may no longer have a spouse when you get back, or your child may no longer recognize you,” Ang says.

The government relies on the money they send home to prop up the fragile economy. Countries that host Filipino migrant workers know that. Last year, Taiwan froze the hiring of Filipinos to force Manila to apologize over the May 9 shooting of a Taiwanese fisherman caught poaching by the Philippine Coast Guard. The sanction was lifted after three months.

In early 2010, the Arroyo administration offered so-called “OFW bonds” worth $500 million in an attempt to directly tap into the remittances. Much of the money Filipino migrant workers send home go to education, household expenses and consumer goods.

Commission on Filipinos Overseas Chairperson Imelda Nicolas argues, however, that the economy can get a further boost if Filipino migrant workers plow some of their hard-earned money into investments instead of just buying stuff. The agency has several programs teaching financial literacy, but very few take them up because of various reasons.

“Our culture is that we tend to get frightened when it comes to money matters. That is why very few people put money in banks,” explains CFO program manager Nico Herrera. He emphasizes that there are people who do have money and they want to go into business, but they do not have the business acumen.

“They don’t have anyone to advise them,” says Herrera. “Many think of what they are most familiar with, such as computer repair shops or sari-sari stores. But these can only earn so much. They also don’t look around, so they don’t realize that there is plenty of competition.”

Since the start of the Filipino exodus in the 1970s, the government has focused on protecting the rights and safeguarding the welfare of Filipino migrant workers following horror stories of abuse by employers and crimes by human traffickers. But clearly the numbers show that that is no longer enough.

For Ang, he feels that it is his civic duty to teach financial literacy. He says,“Someone has to go there and talk to them and explain to them these things.”

Kuripot gifts for everyone on your list

By Yahoo! Special Projects

Here’s your shopping guide for that last mad dash around the mall before Christmas eve.

We know how stressful it can be picking Christmas gifts for your loved ones. You don’t need the added stress when you dive head-on into the mall crowds. So we’ve decided to help you out with this gift guide for everyone you basically need to buy gifts for. Check it out and see if our suggestions fit your family and friends.

For Dad: Cozy PJ’s.
Hit your dad with a bit of humor and get him some pajamas in an outrageous print: tropical birds, cute puppies, animal print.
How about this: Pajamas, P429.75

For Mom: A stylish eco bag.
Make sure that when your mom hits the mall, she stays earth-friendly with your thoughtful gift.
How about this: Eco-bag, P129.75

For Ate: Nail polish in her favorite colors.
Does she like it glittery? Does she like neon? Give her a small basket of her faves, complete with all the other things she’ll need for a nice manicure: nail polish remover, cotton balls, cuticle trimmer, nail file.
How about this: A bottle of nail polish, P24.75; a bag of cotton balls, P29.75; nail polish remover, P12.75; nail file, P39.50 for a set of 6; cuticle trimmer, P29.75

For Kuya: Cool headphones.
This is a win-win gift: it will make your older brother happy and, at the same time, you won’t have to listen to his kind of music ever again.
How about this: Headphones, P249.75

For Bunso: For girls, any stuffed doll.
In the age of voluptuous Barbies, heavily made-up Bratz dolls, and scary-as-heck Monster High dolls, a back-to-basics stuffed doll that’s actually huggable is a great idea!
How about this: A stuffed doll, P349.75

For Bunso: For boys, a ukulele.
Playing a musical instrument is good for the mind and soul; and it will give your brother a precious break from the gadgets he probably uses a lot.
How about this: Small wooden ukelele, P175.75

For Lolo: A pair of soft bedroom slippers.
If your lolo likes to spend his time at home reading the newspaper, relaxing on the couch in front of the TV, or playing with his grandkids, he’ll love soft slippers that’ll keep his feet warm and comfy.
How about this: Fuzzy bedroom slippers, P150.75

For Lola: A chic handbag.
Have you ever seen your lola leave the house in an outfit that wasn’t coordinated from head to toe? Probably not. Show her that you appreciate how she’s still the bomb by giving her a stylish handbag to use for her ladies’ lunches.
How about this: Faux leather handbag, P499.75

For your in-laws: Soft robes.
They are the reason why you’re incredibly happy this season. So show them your love and gratitude with soft robes they can lounge in at home.
How about this: Terry-cloth robe, P365.75

For your best friend: Microwave popcorn, with a promise of a movie-marathon night.
This one is tough. Picking just one thing to give someone you know inside and out takes a lot of deliberation. Why don’t you get him or her something you can do together. (After all, you’re each other’s better half, right?) Movie marathon, anyone?
How about this: Microwave popcorn, P131.75 for a pack of 3

For your officemate: A coffee mug, with coffee beans.
Nothing binds you together more than mealtimes do. At breaks, you gossip in the pantry; and you eat lunch together. He or she would probably appreciate a coffee mug; more so if you include a bag of coffee beans.
How about this: Ceramic mug, P99.75

When Life Insurance Isn’t Worth It

By Greg McFarlane | Investopedia – Mon, 19Mar2012

The principle behind life insurance is simple, in theory. It’s also morbid, at least compared to other financial services. You pay small amounts at monthly intervals, and should you die, a beneficiary of your choice gets a sum of money approximating what you would have earned had you stayed alive.

That’s the stark truth right there, which a lot of life insurance customers fail to comprehend: the service is supposed to be nothing more than a replacement plan. The idea is that should your family suffer a crisis that transcends finances, at least their finances won’t be impacted too negatively. If you die, your spouse and kids won’t have to take on multiple jobs, beg for alms nor lose the house and car.

Hedging Your Bets
It’s important to remember that life insurance isn’t really “insurance” in the dictionary sense. When you buy life insurance, you’re not “insuring” anything. No matter how much money you give them, Ameriprise can’t keep you from dying. No, life insurance is more about hedging your bets than anything else. While you’d prefer to live, if fate has an alternate plan then you can spend money now to help your family avoid multiple catastrophes later.

But as a result of it being called insurance, there’s an overly conservative type of person who believes that if “coverage” of some kind is good, then more coverage must be better. Buying life insurance thus becomes a test of one’s capacity as a responsible adult and breadwinner. What kind of person doesn’t want to protect their loved ones? To that end, some people insure anything that moves – even (especially) their children.

Sounds great in principle, until you remember that kids don’t earn any money. Or at least not any money that’d be difficult to replace. Which reinforces the morbidity of life insurance: losing a child is such a colossal tragedy that if there’s any eventuality that needs to be prepared for, it’s that. Some parents argue that they couldn’t function after the death of a child, and thus a policy on said child helps them sleep at night. But if you claim you’re not going to be able to function anyway, why not keep the money you’d have otherwise spent on life insurance for someone who barely earns any income?

The same goes for older relatives. Both the healthy and infirm have a decreasing amount of time remaining, and the less healthy an older relative is, the smaller the death benefit you’ll receive for a policy of a similar premium size. Add retirees’ limited income (regardless of how substantial their net worth may be), and much of the time, senior insurance seems like an unwise move.

How Much You’ll Get
Stay alive, and a standard term life insurance plan has zero return. Start a 20-year term policy today, and if you don’t die by 2032, you’ll have received nothing. That’s not a bug of life insurance design, but a feature. After all, throughout the policy’s term you’re getting whatever peace of mind comes with knowing that your death won’t impoverish your family. Most policyholders understand this, and appreciate that life insurance isn’t intended to be an “investment” in the conventional sense.

Other insurance customers are uncomfortable at the idea of sending a long series of fixed payments to a financial services firm with the certainty that they’ll never see any potential for profit. Rather than accept life insurance for what it is – again, a replacement plan – these customers want some sort of return. Thus the industry devised whole life insurance and universal life insurance, two variants on term life insurance that each offer a cash value beyond the standard life insurance death benefit. You pay a little more each month than you would with a term policy (we’d call the little more a “premium” but it’d just confuse things), and the difference builds and can be redeemed at your convenience.

Purchasing policies more complex that a term life insurance policy could make economic sense if the cash value increases quickly enough. But investing and insuring are two different and usually incongruent goals. There are surer and more direct ways to invest, beyond enhancing one’s insurance policy with a form of annuity. A combination protection plan/investment plan is like a combination toothbrush/nail file, assuming such a thing exists. The hybrid probably isn’t going to perform either task as well as the disparate products it aims to replace.

The Bottom Line
This isn’t a jeremiad against life insurance in principle. If you’ve got sufficient income, a risky enough likelihood of staying alive (which a prudent insurer will take note of and charge a correspondingly higher premium for), and enough dependents with little earning power among them, a term policy isn’t necessarily a poor way to spend your money. Just remember that investing is deferring spending in hopes of a financial gain. Insuring is spending now in hopes of avoiding financial loss. In that respect, the two activities are almost opposites. An insurance policy that masquerades as an investment is rarely going to be your best option for accomplishing the conflicting goals of maximizing return while minimizing risk.

Real-life loan stories – A must read

BDO Money Matters | By Mark B. Aragona for Yahoo! Southeast Asia -Wed, 28 Nov 2012

What does life look like when you’re borrowing money? It takes major adjustments to get what you want, but it’s often worth the risk. Below are stories of how some people made loans work for them, and not the other way around.

Housing Loan

Kristine, 34, is a newly-married teacher. Like most couples, she and her husband dreamed of owning a house. They picked out a condo unit under pre-selling, but as they were just starting out in life and couldn’t afford the usual 20% down payment, they looked for some possible solutions.

One choice, which they rejected due to their high interest rates, was to let the developer’s in-house financial company fund their down payment. Their broker showed them a second option: apply for a bank housing loan for the down payment, then follow it with another 10-year loan to cover the rest of the amortization.

Kristine and her husband agreed, gathering needed documents like the deed of sale from the broker, their cedula, proof of employment, and IDs. Because they were already long time clients of the bank, they didn’t have to submit other kinds of documents like passports. After three weeks of processing, their application was approved with an interest of 10% per annum.

Now, Kristine and her husband are paying off the 20% down payment, which will last for the next 13-15 months, then they’ll work on the other 80% over the next 10 years. “In the beginning, it was scary,” says Kristine. “I felt like I was selling my soul, because I’ve never had a loan this big before. But everything worked out fine in the end and we’re able to pay our monthly dues. It’s still quite a commitment, though, and we agreed not to have kids till we’re done with the down payment.”

Car Loan

Paul, a 33-year old physical trainer, obtained a car loan out of his necessity: his old car finally broke down after many years of service. He put up a 25% down payment on his own but needed the loan for the rest of the amount. After submitting his proof of income, bank statements, proof of residence, and his pay slips, his application was approved within three weeks: he received a four-year loan at 20% interest per annum.

“It was convenient,” he said. “There was no trouble at all once I finished submitting my files. Of course, it would’ve been really nice to have bought the car with plain cash and avoided the interest payments, but it just wasn’t possible. For me, this was the second-best alternative.”

Personal Loan

Finally, Mark, a 27-year old IT specialist, wanted to start a small food business but needed some seed capital. As it turned out, a bank was offering personal loans to the employees of his company at 15% per annum. He snapped up the chance and took on a 1-year loan of Php100,000, the monthly payment of which would be automatically debited from his paycheck.

After eight months, Mark found his business was taking off and needed more time and attention. He decided to quit his job. However, he found that doing so would mean that the balance on his loan would be due and demandable. Because the loan would completely eat up his separation pay, he decided to try and negotiate.

Mark met with the loan officer and offered to continue paying the remaining five months using checks. At first, the loan officer refused, so Mark then took it up with the manager, and even all the way to a vice-president. In the end, the bank agreed, and Mark finished the loan as scheduled without any additional burden on himself.

“My take-away is that as long as it’s within reason, the terms of loan are negotiable. You just have to keep trying and look for someone who would listen to you.”

How To Keep Your Cool Under Pressure

By Mel Sin for Yahoo! Southeast Asia | Sat, 4 May 2013

There are days when you feel your buttons are being pushed way too hard. But the last thing you want to do is detonate in bad language and angry gestures! So here you go – our tips on how you can keep cool in various situations and come out of it smiling (even if you were boiling inside to begin with!).

How to keep cool… with your kids
One for the moms: Like it or not, but kids can have a knack for bringing out the worst in adults. And it may seem easier to just give up and throw in the towel when dealing with a difficult child, or lose your temper, which isn’t exactly ideal.

So how do you keep your cool when your temper is red hot? Try this: Look at the situation in perspective. Your child may have a reason for lashing out or could be having an off day, which is completely normal as we are all entitled. So instead of being angry, take a breather and know that your child doesn’t intend to drive you crazy; he or she just needs a little more attention than before.

The other thing that works? Get goofy! Nothing works like being silly. This provides a great distraction and soon everyone–kid and you included–will forget why you’re angry in the first place. Sing a silly song, dance crazily, or just have a tickle fest. It works all the time.

How to keep your cool… with annoying colleagues
We all have them–annoying colleagues who just say the wrong thing and do the darnest thing to get on our nerves. From not meeting their end of the bargain to simply not knowing when to shut up, we don’t blame you if there are days when you feel like using the tape to seal your colleague’s mouth shut.

Wait, let go of that masking tape and opt out of violence instead. You don’t want to blow up and be known as the “Crazy One” at work. First things first, to remain calm and to keep your composed professional self–breathe. While your first instinct may be to snap back at your colleague, you’re better off stepping back and taking a deep breath instead. This buys you time to stop you from saying something you will regret. If you must, vent to a friend (someone completely out of your working zone) over a cup of coffee. Just being able to let it all out can do wonders to your mood.

Still annoyed? Find your happy place. Whether it is a few minutes on your favorite website or moving on to the next level on Candy Crush, taking time out will distract you from what’s bothering you in the first place, lets you ease your stress, and help you get back to work in a better mood.

How to keep your cool… when fighting with your partner

You’re both raising your voices and tempers are rising. But before that fight with your boyfriend or your husband turns into an all-out argument where you’ll both regret the things that come out from your mouth, try this.

In the article Fighting Happily Ever After by Elizabeth Bernstein from online.wsj.com, Dr. Howard Markman, professor of psychology at the University of Denver as well as co-author of Fighting for Your Marriage, calls it the “speaker-listener technique”. In this technique, Bernstein explains that Dr. Howard suggests  “couples who have adisagreement should call a couple’s meeting, set a time limit of 15 minutes, and discuss the issue at hand. He even suggests flipping a coin to see who gets to speak first.”

After stating your piece, you should then give your partner the chance to speak, explaining one’s position. “A lot of times, all you need is to be listened to,” says Dr. Markman. Through this exercise, the resolution will then become obvious, says the good doctor. If not? It’s time to schedule another meeting.

Remember the few golden rules of fighting: don’t make it personal, stop trying to win all the time, and make sure to listen. You’ll soon realize that the argument was for nothing.