Cover Story Excerpt:
Chinkee Tan: On Positive Thinking and Managing Family Finances
Chinkee Tan learned about business at a young age. “I have never been employed. I’ve been in sales since age twelve and my whole life has really evolved in sales,” he shares. At the time, Chinkee sold toilet papers, pants, shoes, and shirts after his father lost his business and the young man had no choice but to help out with the family’s finances.
After getting a Business Management degree, Chinkee established a company that distributes health products like green and red iced tea, and vegetable supplements. He sold his business in 2006 to pursue another passion: being a motivational speaker. “I love to inspire, motivate, and challenge people. I love giving them hope.”
How to Fund Your Children’s College Education
Developing skills, learning from experts in different fields, enhancing growth, better standard of living for the future, meeting new people and making new friends, higher self-esteem, a ladder to climb out of poverty, contributing positively to society, wanting a job security with a higher paying job and seeking a better understanding of the world around us. These and many other reasons why higher education plays a vital role in people’s lives.
While the importance of a college education is quite evident for many, what is often not as clear is how we will pay for that education. Colleges and universities of today carry a heavy price tag and it is important not to be disheartened from helping and encouraging our children to get into higher education.
The Six Pillars of Life Protection
A decade ago, life started to veer me to a different direction, more of serious work away from the fancy world of fashion. I joined a financial services company and now have a portfolio of 700, passionately embracing the fact that I can change peoples lives by the experience and the knowledge I have gained being a financial planner and wealth manager.
This life changing exposure to helping people build their wealth is now my advocacy. That brings me to how I came up with the pillars of wealth, stated by importance.
Have you ever hidden expenses from your spouse? Or at least, have you ever been tempted to do so? If you’re reading this with your spouse, you’ll probably deny it to death! But it wouldn’t be surprising if you have done this, even in the distant past. Do you realize this is one way of cheating your spouse? Think of it this way: you’re a team, a single unit. Whatever each of you earns belong to both of you. So if you spend on something and intentionally hid it from your spouse, aren’t you cheating?
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How do you manage your family finances? Why not run it like a business? Here’s how:
1. Establish Your Purpose
Did you know that some wealthy families have family constitutions? Well, you don’t have to go that far. But it could do your family well if you set your purpose. Businesses exist for a purpose, and so should your family. That means setting a family vision and mission statement. What is your vision for your family? And what is your mission to fulfill it? Answering these questions will help you and your spouse (and even your older children) to dig deep and figure out what you value in life. With a purpose, you will have clearer direction and guidelines. Otherwise your family will just coast through life. For example, in our case, we want to be examples and advocates of stewardship.
2. Set Your Plan
Now that you understand your purpose, you can be more intentional in what you do, which often involves money. Since we want to be good stewards, we try to be careful how we spend and grow our money. Setting your family’s financial plan starts with knowing the state of your finances. So it’s important to run the numbers and find out two things: your net worth and your cash flow. You get your net worth by preparing your family’s balance sheet, with your assets on one side and your liabilities on the other. The difference is your net worth. You figure out your cash flow by making an income statement or cash flow statement, with all your income and all your expenses. The difference is your cash flow, positive and negative. This way, you know where your family stands financially. Then you can develop a spending plan or a budget to direct where your money goes.
3. Divide Your Responsibilities
Companies have organizational charts, so why not your family? For us, I am the CEO, CIO, and CMO. My wife is the COO and CFO. Our kids, well, they’re too young to be our staff, but they are in fact our apprentices who we need to train as they grow. We have of course our office and household staff, and they have roles to play. Having clear roles and responsibilities make us responsible and accountable. I am in charge mainly of bringing in the revenues and making investment decisions while my wife takes care of managing expenses and handling accounting.
4. Review Your Performance
As with any business, you have to review your family’s performance in various areas, including finances. That involves doing regular reporting on your finances (it can be weekly or monthly) so you can cut costs where necessary. You should also evaluate your investments on a quarterly basis. And once a year, do a full-year review and planning for the following year. I suggest you go on an out-of-town trip to make it fun, relaxing, and inspiring. Hey, if companies do off-site retreats to rejuvenate and do their annual planning, why can’t your family?
5. Incorporate Your Family Business
You may want to consider as an option putting up your own family business? It can be a part-time, home-based business as a start. Not only can it potentially add another revenue stream for your family finances but it can also become a legacy you can pass on to your children. A business is an asset after all. Besides, a business is a good tax shelter. You can combine business and leisure like traveling, eating out, etc. and use those expenses as deductions to your taxable income (as long as they are legitimate). You can deduct part of your rent, electricity, equipment, etc. as well if you have a home-based business. But most of all, despite its own set of challenges and conflicts, having a family business is a great shared bonding experience that can help make your family stronger and richer.
Heinz G. Bulos
Table of Contents
- Chinkee Tan: On Positive Thinking and Managing Family Finances by Ruth Manimtim-Floresca
- How to Fund Your Children’s College Education by Robert James Morales, RFP®
- The 6 Pillars of Life Protection by Rowena Suarez, RFP®
- Financial Infidelity by Heinz and Ambie Bulos
- Easy Money: The Cost of Having a Baby by April Amba, RFP®
- How To: Raise Your Child to Be an Entrepreneur by Excel V. Dyquiangco
- The Bottom Line: The ABCs of Homeschooling by Edric Mendoza
- The Bottom Line: 10 Reasons You Want a Portfolio Career by Heinz Bulos
- RFP Money Makeover: Assets Accumulation Before Starting a Family by Paul Erik Tiu, RFP®
- No Nonsense: 5 Finance Things to Do Before You Hit 30 by J. Randell Tiongson, RFP®
- Financial Planner: Lean on Me, When You’re Not Strong by Efren Ll. Cruz, RFP®
- Successtories: What Are You Building? by Alex Araneta
- My Money Story: From Abstract To Luminous by Marco Coching as told to Excel V. Dyquiangco
- My Money Story: Keeping Alive a Family Legacy by Modj Mojdeh as told to Ruth Manimtim-Floresca
- My Money Story: Life on the Farm by Reden Costales as told to Excel V. Dyquiangco
- Easy Money: When Do You Sell Your Stocks? by Marvin Germo, RFP®
- Easy Money: How to Find Winning Stocks in 1 Hour (or Less!) by Charmel Delos Santos
- Easy Money: Step #5 – The Lease Contract by Carl Dy
- Forex 500: Should I Take A Loan In Pesos Or Dollars? by Mark So
- High-Heeled Trader: Low-Risk High-Reward Stocks Investing by Charmel Delos Santos
- The Bottom Line: A Primer on Balanced Funds by Edmund Lao®
- The Bottom Line: Dividend Stocks – What Are They? by Ricky G. So, CIS, RFP®
- Easy Money: Make Your House Childproof by Excel V. Dyquiangco