It has been a whole month and five days now of freedom. Compared to back when it just happened, I seem to be a lot better now. I have pretty much gotten sick of doing of nothing but enjoy new-found freedom and have decided to start making those baby steps toward self-improvement.
I haven’t saved much and whatever savings I have accumulated during that free time is still pretty much in the five-digit range. I am thanking God they didn’t have anything nice in the stores recently, as I might have ended up splurging on things I don’t really need.
I told myself that I will give myself a month to sort whatever feelings I might still have (or no longer have) and the “Love Thyself” mindset. Back to business mode. I am currently applying for a loan worth 100K to speed up the process of a personal business venture that I can look in to on my spare time.
I have decided on the buying and selling of automobiles because I found it hard to get by without one. During the first two weeks I had been really considering to get myself another Honda Jazz or that pretty VR-4 Galant. This loan will help me out a lot I’m sure, but I haven’t called about the small particular details to be able to formulate a plan that will help dampen the 56% interest rate for three years.
So here goes the plan:
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Option 1 (the safest, but it takes longer to reap)
Target time: 6-10 months
Needed:
1 Checking Account.
1 Time Deposit Account (set up to automatically deposit the gains to the checking account) (You can also try government bonds, but i don’t know how it works)
A loan @ 100K at 56% for three years is about 4,300 PhP a month approximately.
All your bonuses and incentives. (yes, you still get to keep your gross salary intact)
An easy figure if you think about it, mainly because I have a job that I intend to keep.
One way of easing off on the interest is to put the whole amount first in time deposit and you earn about 2525 a month (which accrues interest of course and it adds up.) I was thinking of not spending the 100k at all and put all my bonuses in it while keeping it there. I will have to put up a checking account for the loan since there is no collateral required (pre-dated check payments) on it so in the long run; after a few sleeply mornings in front of the calculator, I figured that to earn more than the monthly rate of PhP4,300 a month you have to practically double the amount to earn from this particular scheme. Since I have a job that pays… well enough, The last 3 months of the quarter will be crucial in making it work. I am waiting for my KPI Incentive (bi-yearly), 13th month pay and leave credit conversions. That’s approximately about 50-60k in additional income but salary and taxes aren’t added yet to the calculation. After putting all my eggs on the time deposit, I would have about 200k (give or take) which will yield about 5k a month approximately. Viola! You have a loan that pays for itself.
The Yield:
After you hit the 200k mark, you practically leave it alone and stop yourself from touching it. You still can but you must never go down the 4,300 a month mark in gains. You get to keep your salary from there on and live normally. The only difference is, you have money in the bank that is growing steadily. I plan to continue putting all my bonuses on the time deposit until it reaches around 300k, which I can use to play around with for more income. I will keep 200k on time deposit and play with the 100k.
*note: 500k in time deposit yields 5 digits!
The Good: It is something you can leave alone without thinking about it. Slowly but surely. Less risks.
The Bad: You have a lot of money and you will be tempted to spend some of it. (just a little… please!?) Once you do, you’ll have a hard time again building up momentum.
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Option 2(risky, but yields faster)
Target time: Depends on Luck or skill.
Needed:
Time, lots of it.
Persistence.
Patience.
Something to spend on for buying/selling.
I am thinking of buying and selling automobiles. The 100k Loan I plan to get will be the starting money you will need to purchase a second hand car. Reason for this is: you can buy and haggle to get the lowest price, and then sell for the highest reasonable price. I plan to buy the first car at the 70-80k range. You’ll get a crappy car, I know but there are a lot of cars out there that either runs bad but looks good on the outside, or still runs well and looks crappy in the outside. It will be choosing between the lesser evils. I would suggest getting a decent exterior and put a little money to fix whatever is under the hood. Watch out for sacrifice sales, they tend to be blinded by front money and you can haggle even less than what you can normally go for.
The problem with this set up is that you will have to sacrifice time to scout around for prospective targets. Once you have your target, you will have to advertise and wait for offers. Once offers are made, you will have to entertain them (even if they are just looking and not planning to buy). Eats up a lot of your time and you still have to go to work to earn so that you can pay for the amortization.
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That’s it for today. 
Life is beautiful.