Cashflow 101

I received this invite from a friend two weeks ago. Since my March 26 is free, I decided to attend this seminar. I have wanted to attend this kind of seminar but the cost is no joke. The cheapest I researched is P2,000 per session and it only tackles one part of financial management (stocks or mutual fund, etc).

Not really expecting anything from this seminar (since it’s practically free), I went to Ateneo one fine afternoon. I was the first to arrive and had to wait for more than an hour for the people to come in. Good thing speaker Jeric Lee was very cordial and chatted with me for a while. The event was organized by LD (Life’s Directions) and I can see most of the members are younger than me (makes me feel old again). Later I found out that LD is a group for singles! haha!

The speaker: Jeric Lee is a business coach, trainer and investor. he also started in the rat race or corporate world but knew he needed to get out of it and gain financial freedom and have time for his family and the people that are important to him.

His seminar is more of helping the others realize where they are right now financially and how to get out of the rat race or the corporate world and gain financial independence. The seminar focused on how to make money work for you rather than working for money as inspired by the book Rich Dad, Poor Dad by Robert Kiyosaki.

I have read this book 10 years ago and this inspired me to prepare for my financial future. Kiyosaki was already retired and playing golf by age forty. I hope to be as financially confident by that age (although after the seminar, it looks like I’m gonna have to work double or triple time now).

The 4-hour seminar was spent mostly playing the board game Cashflow 101. If you played Monopoly as a kid, it’s basically like that but focused more on investments like stocks, real estates, businesses,etc. It also has consequences (Doodad), lose a turn, etc.

The game commenced with every player on the START of the rat race and the goal is to be able to get out of the rat race and into the Fast Track where you choose your dream. It’s role-playing game so each player chose a particular career or job which is also provided by the game. A job has corresponding financial statement and each player will work from the given FS. It’s really a fun and challenging game because you have to be wise what to purchase and invest althroughout the game. By the way, each player starts off with 0 kid and each child you have along the game adds to your total expense. Okay, I get that but being a mom is totally fulfilling in so many other ways. Oh well, I guess the game will only measure quantifiable things J

As the first part of the game finished, I ended up having the highest Profit in our group :0 What that means? I am capable of revolving my income as many times as possible. I got 3.17 which mean I can revolve my money 3 times over. In the real world, I can say I’m like that. I’m basically your thrifty (not stingy!) kinda mom because savings for me is very important. I can spend 10 minutes per product type in a grocery (more if there are more choices) just to make sure I get the best value for my money. Imagine how much time I spend inside the grocery store haha! Unfortunately, in the game, majority of us was unable to reach the main goal which is fast Track. To get this, your ‘passive income should be bigger than total expense’. If you analyze this, your passive income which you invested in is earning dividends, interest,etc. without you sweating over it so much while it also answers your total expenses. Your paycheck can go untouched. Isn’t that great! Talk about money working for you. Guess who achieved this goal in our game? A janitor! It’s not important what your profession is, it’s how you play smart in terms of increasing your passive income.

Other things I learned during the course of the seminar:

Rich vs. Wealth – rich is if you can provide for you and your family’s needs comfortably even if you don’t work for years. Wealth means having secured income for generations even if you don’t work. Yes, we are talking of generations. Those lucky lucky great grandchildren!

Assets vs. Liability – assests puts money in your pocket while liability takes the money out of your pocket. So, is real estate an asset or a liability? :)

Income will get you out of the Trap from the Rat Race. The best income is the passive income and the goal is that passive income is greater than the total expenses.

During the course of the game, we were adviced by our ‘financial advisor’ to put all our money on a certain stock which eventually gained us (those who followed the advisor’s advice) 40 times than what we invested. The lesson? It is also important to seek advice of a professional in making major financial decisions. There are very rare self-made multi-millionaires. Even the most successful tycoons have advisors until now.

Hope you learn from this entry.

the cashflow 101 game board . each player chose their mouse for the game :)

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that's my dream but it cost $250,000 which my total income did not reach :(

speaker Jeric Lee. Thanks Jeric for that very enlightening seminar :)