(A Letter by Bo Sanchez to members of the TrulyRichClub)

Today, I’d like to talk about Income vs. Wealth.

But before that, let me answer this question: Why talk about money?

Because we want every area of our life-even our finances-to be placed under the Lordship of Jesus. We don’t want money to be our master. We want to be the master of our money-and turn it over to God’s purpose.

There are some Christians who don’t want to talk about money, so they run away from it. But when they do, their master becomes the lack of money.

That’s not want we want. We want to learn how money works so that we can use more of it to serve God.

Let me start talking about a special ministry that’s very close to my heart because I started it many years ago: Anawim.

If It Happened To Them, It Can Happen To You Too

Anawim is our home for the abandoned elderly-poor, old people we pick up from the streets. Throughout the years, hundreds of old people have been housed and fed and loved in our special home. After a few years of staying with us, they go home to God. Anawim is like a special departure airport to Heaven. Without Anawim, they would be dying in the streets.

But here’s a surprising fact: They weren’t always poor.

At one point in their lives, all of them were earning good money. If you talk to them, you discover that some Lolas and Lolos were Government Employees. Some were Teachers. One was the Principal of a school. One was a Dentist. Yes, some were maids and laundry women. So you might say they were always poor. But I refuse to accept that. Because for more than 30 to 40 years, they were sending money each month to their nephews and nieces back home. (Nephews and nieces who abandoned them in their old age!)

But one day, they found themselves wandering in the streets without clothes, food, or shelter.

Here’s my point: Are you earning today? Then what happened to them can happen to you. Unless you decide to build your wealth for your old age.

Let me teach how the 3 important steps to build your wealth for your old age…

The Only Way To Build Wealth Over Time

People tell me, “Bo, Anawim is so beautiful. Please reserve a spot for me there.”

I answer, “I don’t want you to be our burden. I want you to be our blessing. I don’t want you to dwell in Anawim. I want you to donate to Anawim. In your old age, I want you to write checks to me-because you have surplus. To do that, there are three important things that you need to do to build your wealth for your old age.

1. Receive (Regular Income)
2. Retain (Simple Lifestyle)
3. Reproduce (Financial Literacy)”

1. Receive (Regular Income)

If you want to become rich in your old age, the first requirement is to receive a regular income today.

Here’s the shocker: To build wealth in your old age, you don’t need super income, you just need steady income.

A lot of people think that income and wealth are the same. They’re not. A big income doesn’t equal big wealth.

Let me tell you about Jack (not his real name). When I met him, he was President of a huge company and earning much more than P500,000 a month.

His income was big. But so was his lifestyle. Jack drove luxury cars and travelled around the world. Always first-class. He had a mansion in a plush subdivision. Everyone around him knew he was wealthy. But they were wrong.

Because throughout his working life, the most he saved was one million pesos. (That may be big for you and me, but to him, one million will last two months.) Why didn’t he save? Because he was banking on his fat retirement pay. Reason: He worked in that company for 20 years.

True enough, when he retired, Jack received P10 Million.

But he never changed his lifestyle. After only 2 to 3 years, he woke up one day with all his money gone. Soon, he sold his cars. Soon, he was asking money from his children.

What happened?

He did Step 1. He received an income.

But he never did Step 2 or 3.

2. Retain (Simple Lifestyle)

People say money can’t buy you happiness. I agree.

But face it, happiness requires a minimum level of money. I don’t live in Lala-land. We’re human beings with physical bodies that need stuff to survive and be happy.

But the other side of the coin must be pointed out as well. After we reach our “Happiness Point”, more stuff won’t make us happier.

When it comes to possessions, I’ve reached my “happiness point” a long time ago. Any more possessions won’t make me happier. In fact, I believe the opposite happens: After reaching my happiness point, more possessions will lessen my happiness. (See graph below.)

Where Is Your Happiness Point?

Why does this happen? Because more possessions will mean more clutter, more stress, more worry, more envy, more costs, more taxes, more insurance…

Jack, the former company President, spent all his income. Like many people, he was enslaved by the hypnosis of materialism.

To avoid the hypnosis of materialism, don’t swallow the world’s definition of “Rich.” You need to define what it means to live a “Rich” life.

Let me give you an example…

Are You Sure You Want A Mansion?

Everyone thinks that to be rich means you own a mansion.

Here’s my guess: For most of you, owning a mansion will make you less happy, not more.

I believe owning a bigger house will give you bigger headaches. Bigger maintenance. Even bigger homeowners association dues.

My friend stays in a plush home. I was shocked to learn how much his homeowners’ association dues are: Each month, he pays P24,000.

I live in a small, quiet, third-class subdivision where neighbors are friendly and shirtless kids play on the streets. Where 90% of my neighbors drive secondhand cars. My homeowners’ association dues? (Drumroll please…) P120 a month.

Let’s do the math: If my friend lived in my subdivision, he would save P23,880 each month. If he invested (not traded!) that amount in the Stock Market for 30 years at 12% growth, he’d have P77 Million. Wow.

Today, I can afford a bigger house. But I refuse to have one. Because we’re very happy with my small house. It’s small enough to know where my kids are. It’s small enough that we bump into each other a lot. If I don’t know where they are, I can just holler “Benedict!” and “Francis!” and they’ll come.

How Much Is Your Electric Bill?

I’m very proud of our electric bill. I only pay P3000 a month.

I know that electric bill isn’t the electric bill of a multi-millionaire. (Ahem). But perhaps that’s why I’m a multi-millionaire.

I have an air-conditioner in our living room. But I only switch it on when there are guests. That’s why my kids love guests.

The kids have an air-conditioner in their bedroom. But because they like staying with us, we only use the one in the master’s bedroom.

My friend has less money than me (I know because I’m his financial consultant) but his electric bill is P18,000 a month.

The difference between P18,000 and P3,000 is P15,000.

If he lowers his electric consumption to my level, that’s P15,000 that he can invest (I repeat: not trading!) in the Stock Market each month. In 30 years, at 12% interest growth per year, that P15,000 a month will become P45 Million.

What Kind Of Car Do You Drive?

A few weeks ago, I was driving my car. And my wife was beside me. While driving, I reached out and held her hand. That was when it hit me. I told her, “Sweets, my long-time dream has come true!”

“What dream?” she asked me.

“Remember? Before we got married? When you were still courting me? (Slap.) Er, I mean, when I was till courting you? I’d drive you home. And I wanted to hold your hand. But I couldn’t, because I was driving a manual car. I had to keep on shifting gears. So I told you, ‘One of these days, I’ll be driving an automatic car. So that I could hold your hand all the way home.'”

Come to think of it, I think that was the line that clinched the deal. I won her heart from that day on.

At that time, I was driving a car that was given to me. I couldn’t afford to buy any car, much less an automatic car.

But that was also when I became an entrepreneur. And I began to earn more. Slowly, my income increased. But here’s how I became rich: For 10 years, my lifestyle didn’t change. I was still spending money as though I was earning 1/10th of my income.

Finally, I bought my first automatic car just last year-after 13years of our marriage.

I could have bought my car many years ago, when I became a millionaire. (I still remember that day. I was 34 years old. I told my wife, “Kiss me, quick.” After she kissed me, I said, “You just kissed a millionaire.”)

Delaying gratification works. It gave me time to grow my investments over time.

Does Your Pail Have A Hole?

Building wealth is like collecting water in a pail.

If there’s a hole in the pail, the water will just drip out-and you won’t be able to collect any water.

That hole represents materialism.

What do you need to do? Plug the hole. And the only plug that can cover that hole is simplicity. If you don’t live simply, money will keep going out of the hole.

But alas, even simplicity isn’t enough. Plugging the hole in your pail isn’t enough. You need to constantly put new water into your pail…

For that, you need the third element…

3. Reproduce (Financial Literacy)

Retaining your money isn’t enough.

Why was Abraham wealthy? He didn’t only retain, he reproduced. The Bible says, Abram had become very wealthy in livestock and in silver and gold. (Genesis 13:2) At his time, wealth was measured by the heads of cattle, sheep, and goats that you had.

Here was their rule to wealth: If you wanted to become rich, don’t eat or sell all your animals. You have to keep some of them to reproduce after it’s own kind. The more animals you reproduce, the richer you become.

One sheep can give birth to one to three lambs every year. That’s a growth rate of 100% to 300% a year.

The secret of wealth is to keep your wealth reproducing after its own kind.

Where Do You Invest Your Money?

I’m not asking you to buy cattle, sheep, and goats. Times are different today. There are only three places to invest your money: Paper Assets, Business, and Real Estate. (Note: Paper Assets mean the Stock Market and Bonds.)

Not everyone can start a business or buy an income-generating property now. (In time, yes, through financial education.) But I believe you can invest in Paper Assets now. Out of the three kinds of investments, it’s the easiest investment to make in your life.

Specifically, if it’s a long-term investment, I encourage you to invest in the Stock Market. I don’t believe that you should trade. That’s dangerous. I’m talking about putting 20% of your salary each month in giant companies for years-disregarding the ups and downs of the market. If you follow this simple system, the Stock Market is the best, safest, and most effective way to build your wealth in your old age. (I teach this powerful system of investing. Click here to find out how!)

I know that’s a controversial statement, but suspend your doubts and hear me out first.

Your Money In The Bank Is Shrinking

One day, after teaching people how to invest in the Stock Market, one man came up to me and said, “Bo, is the Stock Market really safe? I’m scared to put my money there. I feel safer in the bank.”

I told him, “Putting your money in the bank is a risk too.” I explained to him that there are two risks: (1) Loss of Capital and (2) Loss of Value.

We’re more familiar with Loss of Capital. When you put your money in the Stock Market-and the company crashes-you’ve lost your capital. (Note: I must tell you that if you follow my system of investing in the Stock Market, the risk is dramatically minimized. For example, if you buy Stocks of giant companies only, such as Shoemart or Ayala or BPI, do you think these giant companies will collapse in the next 10 years? click here to know more)

The second risk we’re not very familiar with is Loss of Value. And that’s what happens when people put their “long-term” savings in the bank. (I believe banks are there for our “emergency funds” only.) People don’t understand that though their money looks the same in the bankbook, it actually shrinks through the years.

When I was baptized as a baby, my parents threw a party in a restaurant. Friends and relatives were invited. Do you know how much my parents spent for that party? I know. I still have the receipt. Mom stuck it in my baby photo album. My parents spent 32 Pesos.

That was years ago, when money was money. That’s what I mean by Loss of Value. In the same way, if you keep your money in the bank, it’ll shrink over time.

Instead Of Borrowing, Lend!

Here’s what the Bible says:

The LORD will open the heavens, the storehouse of his bounty, to send rain on your land in season and to bless all the work of your hands. You will lend to many nations but will borrow from none. (Deuteronomy 28:12)

Yes, God wants to pour bounty into your life.

And God doesn’t want you to borrow. So stop borrowing. The Bible says, the borrower is the slave of the lender. They say slavery was abolished 200 years ago. That’s not true. There are many slaves today of credit card companies.

Instead of borrowing, God wants you to lend. Can I give you another word for “lender”? Investor.

Don’t lend to any Tom, Dick, and Harry. Unfortunately, many people will run away with your money and never repay you. I believe He wants you to investyour money to giant businesses that will repay you with interest.

Filipinos Need To Learn How To Invest

Some friends were inviting me to give a financial seminar to their large Christian community. So I offered to give them my seminar, How To Make Millions In The Stock Market. But the leaders of that community politely declined.

I don’t blame them. We’ve been brainwashed. We were taught that the Stock Market was dangerous, and the bank was the main way to save money.

But in the US, 70% of the population invests in the Stock Market. In the Philippines? Less than 1% invests in the Stock Market.

But I believe a day will come when this entire thinking of our country will change.

Two Ways To Get Into The Stock Market

You can invest in the Stock Market directly and indirectly.

“Directly” means you open an account yourself and buy the companies you want. You can do this through an online broker, such as our preferred online broker, Citiseconline. (I’m not an employee of Citiseconline. I recommend them for two reasons. First, because they’re the biggest and best online broker in the country. Second, because I know the owners of the company and they have the same vision as we have-giving an equal opportunity for everyone, rich or poor, to build their wealth.)

“Indirectly” means you invest in a Mutual Fund company. You can invest every month and they’ll manage your investment for you, for a management fee,of course. (If you use the indirect route, I suggest you invest in an “Equity Fund”, not their “Balanced Fund” or “Bond Fund”-if you’re investing for the long-term anyway.)

By the way, I’m not the only resource for your financial education. You don’t have to attend my seminars or read my books. There are many other seminars and books out there. Find them and learn. This is about your future-so be serious in learning about it!

Do You Want To Grow Poor Or Grow Rich?

The statistics are appalling. Why do 20% of people in the world own 80% of the world’s wealth?

Answer: The magic of Compound Interest.

If the Stock Market will perform the way it performed in the last 20 years, P2000 a month over the next 20 years will make you P5.3 Million. If you put P5000 a month, you’ll have P13.4 Million.

Because of the magic of Compound Interest, anyone with a regular income + a simple lifestyle + financial literacy can be rich.

It’s now your turn.

My very strong recommendation? Invest 20% of your salary each month in the Stock Market. And build your wealth for your old age over time.

Let me end with God’s promise for you…

God Will Bless Your Storehouse

In Deuteronomy 28:8, it says, “The Lord will command the blessing upon you in your storehouse…”

Remember what happened to Joseph in Egypt? God asked him to build a storehouse during the 7 years of plenty-so that Egypt would have food for the next 7 years of famine.

God blessed that storehouse and Egypt prospered.

Question: How can God bless your storehouse if you don’t have one?

Today, I have a storehouse. My storehouse is my long-term investments in the Stock Market.

It’s now your turn.

Build your storehouse so that God has something to bless!

May your dreams come true,

Bo Sanchez

PS. Do you want to create wealth in your old age? Watch this 11-minute video by clicking here. You don’t have to grow old and poor. You can grow old and rich. It’s really very simple.

To watch this 11-minute video, just click here.q .

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