"Sometimes Investment Returns Aren't Financial" - Chase Tan
Ever since I've started working, I've been reading a lot of articles and books, all about how to make it to the future financially secured. It's been a real goal for me to be able to achieve financial stability at a young age. I'm just afraid of seeing myself in the future relying on other people to take care of me. I'd want to be stable, and can hold up strong on my own.
My first real investment was buying up some shares for a Unit Investment Trust Fund (UITF). It went well the first few weeks, thus I decided to add more. But just weeks after I added a huge chunk, the huge May 2006 selloff happened and the next thing I know, I was losing 3000 pesos already. For a first timer like me (who at that time was working for about only a year), that was big. And the panic settled in. I redeemed my shares, cut losses, and waited for the market to turn alright. Which it did, eventually.
So there goes my first lesson: Do Not Panic!
Panic doesn't do one any good. That was what happened to me. I panicked and sold everything at once. What I didn't know was that I didn't look at the investment for the long term. Considering I really didn't need the money at that time and it was simply extra cash I had saved up over the months, I could've waited it out and eventually it would've gained upward momentum again.
I guess one of the major issues that time was that I wasn't educated about the whole investment field. I lacked the experience, awareness and knowledge of how everything works. If I did my research, I would've known that the whole economy outlook was actually very bullish at that time. It was a correction, that just so happened to occur during my initial attempts in investing.
Don't get me wrong. I did get a lot out of this experience. Not only did I learn to be more careful about my investment actions, I was even able to help out my parents on their business. The money I took out from the UITF, I loaned to my parents to help them cut back on the interests they are paying the lenders. For example, if their interest per month was 12%, then paying out a part of that debt would save them thousands of pesos a month. And instead, they pay me an interest of only a measly 5%. Not only did they save a whole lot of money, they made me somehow feel like a part investor of the company! Not bad eh?
So you see, even though things didn't turn out the way I wanted them to be, I even had a sweeter deal in the end. Even though I am not getting bigger returns as the UITF would've given (given the market these days!), at least I know I was able to help out my parents, and that in itself, can never be replaced by any bigger amount that is waiting for me out there.
