Live in the Philippines — Predict The Future?

Well I would like to say I know something about the future, but truly, I have no idea what the future has in store for any of us.

Really, no mortal can actually predict the future.

But when you see someone who has had a great run at being right on a number of relatively current events … AND … his predictions and especially his recommendations are smart, conservative and low-risk, it pays to at least give a little thought to his predictions   Or so Dave opines, any way.

Live in the Philippines, retire in the Philippines

Mining Coal is All I Know

Harry S. Dent’s latest book, “The Great Crash Ahead” is a really interesting read. If you’re not sure who he is, Dent’s the guy who accurately predicted the Asian Financial Crisis in the late 1990s, the property boom in 2003-5, and the Global Financial Crisis (GFC) in 2008 – all about 10 years before they happened!

In The Great Crash Ahead he shows why the GFC is just the start of a major world-wide recession that will see property and share prices drop even further, and unemployment skyrocket as businesses outsource to cheaper economies.

Now I am not an investment advisor and I especially do nor have much expertise in the stock market or other conventional investment vehicles.

But since many of you reading this are very much into investments, and all of you (at least should) be thinking about your life after a job (which is coming, sooner ort later for most of you), I thought it was interesting to look at a couple of Dent’s recommendations.  (with Dave’s personal “slant” on them, of course).

So what does Harry;s prognostication and some of his recommendations mean for you?

1. Think in terms of cash flow instead of just investments. Look for things that generate a recurring payment.

Absolutely spot on in my book.  The idea of retirement being a time of sitting and clipping bond coupons is dead and gone, in my book.  Just recently I heard from a reader who has a non-trivial amount of savings, currently “invested” in some bonds that are paying him … drum roll, please … 2.5%.  Wow!  What a plan.  Folks, the idea of saving yourself rich is gone, in my view.

More important even than the low rates is the fact that many “conventional,conservative, “safe” investment strategies today will leave you at the mercy of banks and even more greedy “financial services” companies that have built the mess we are now in.

“Mortgage Derivatives”, anyone?  ‘Nuf said.

2. Start thinking in terms of streams of income

Here’s a rather simple question.  But it’s pretty “profoundly simple”, due to the fact that one heck of a lot of you within the sound of my voice can’t answer it correctly.

Suppose you have decided that you need $40,000 a year to live “comfortably” in retirement.

Would it be better to have one stream of income … let’s say a fat IRA account, that is going to give you $40,000 a year?

Or would it be better to have 10 or 12 different income streams, each bringing in at least $4 or $5,000 per year?



Seems to me the answer is simple.  The multiple streams will win every time in the long term.

Not to mention the simple fact that it’s infinitely less difficult to start yet another stream that brings in a few thousand a month than it would be to start something from scratch that brings in $40,000 a year.

3. Shares: Be out between early 2012 and late 2013

I’m completely out of this one.  I don’t invest in the stock market, and I have no direct information on it.

But my independent web income streams have been increasing 20% per year, right through the GFC.  has the stock market done that well?

4. What not to do: buy personal real estate before early 2014

This one is near and dear to my heart.  Buying a personal home as an “investment” is pretty bogus advice in today’s world.  “They” say that renting always costs more than buying?

Well”they” just are not always right.  You might want to read this article and the related ones that it will lead you to: Owning Your Own Home — in the Philippines — Part 5

5. The coming decades will be seen as the age of the individual and the entrepreneur.

If there is nothing else you get from this article, and if there is nothing else Dent says which has any value at all, focus on this.  It’s real, it’s valuable, and it’s what you need to know in the 21st century.  Doesn’t matter if you are 20 years old or 60 years old, or if you are US or Filipino, or any other ‘flavor’ of person, you have to pay attention to this.

Point One: The 21st century is not the 20th.  Having that one stable job, buying that house that will artificially balloon in value and waiting for the pension you have ‘earned’ and the rest of the government handholding (Social Security, Medicare, etc.) is just not going to hack it.

Point Two: You are not who your current job is.  In other words, if you are a carpenter and you have been sitting around for 99 weeks of unemployment benefits, waiting on a carpenter job to reach out and ‘find you’, or for “the government” to help you … get over it.

That is last century thinking.  It won’t work any more.  You can learn to do anything you want … the only real obstacle is you.

Plus you can start right now, today, building your own digital empire in virtually as many different fields as you can imagine.

And, instead of being stuck with “who you are”, you can “be all that you can be”.

What a great time to have an internet business!  Do it right, and you have the financial security of knowing that you have money coming in even if you lose your job. Plus, an internet business can easily give you multiple streams of income, as well as recurring income if you structure it properly.

I’ve already given a number of real-world case studies here on your living in the Philippines resource, PhilFAQS, and I’ll be happy to write about more success stories, if you would like me to?


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Comments

  1. Kuya Ed says

    It’s better to be a company than to work for a company.

    Jim Coudal, Keynote Speech, SXSW 2006

    Don’t do a project where you don’t think you’ll learn something on the way.

    Jim Coudal, Keynote Speech, SXSW 2006

    Jim sounds like a smart guy.

    • says

      Indeed he does. One detail so many people who are stuck in the last-century “cage” of begging for and then being ruled by a job seem to not understand, especially when they talk about ‘security’ is, going on your own is way more ‘secure’than limiting yourself to a J*O*B.

      I can’t be fired, I can’t be laid off, I can’t be told where, when and how I have to report to work and who I must call “sir”.

      Don’t get me wrong, it’s not “magic”, to work for yourself you have to work, really work at times, but the security and the rewards can be significantly greater.

  2. Mike says

    Good Morning To All,
    First, let me say I certainly enjoy the information yourself and your readers share on this site. I have visited a number of expat sites and yours along with the fellow from Davao get most of my attention.

    I am a 68 year old American married to a wonderful Filipina for 11 years now and we are blessed with a absolutely amazing 3 year old son. We are planning to retire within the next year and relocate to the Philippines. We have visited often for extended periods and I truly hope we are prepared for the huge adjustments we will face in our new home. We have deviated from some of the advise offered here and I would like to point out our reasons for doing so. I point these out not to be argumentative but to simply offer a different perspective.

    First, we have chosen to locate near Butuan City where my wife was born and raised. The reasons for that choice are many and I will cite a few. My inlaw family there has welcomed me and has been a huge help to me in my acclamation to the Philippines. They have in no way been a burden, in fact just the opposite, they have been quite accomodating and helpful. I have not had a problem with “borrowing relatives”, again just the opposite. My wife’s family has always been there to take care of certain business matters that we cannot handle being here in the U.S. I have read a number of comments advising against living close to family, however, I am close to my family here and look forward to being close to my family there. The close family ties and inter-relationships are one of the things that has always endeared me to the Philippines.

    Second, After years of research and soul searching, we decided to purchase a home instead of renting. We did so because, I like you, believe that one can no longer depend on past retirement ideas and beliefs. I too think that one should have a plan to earn a living independent of social security and conventional retirement vehicles. The home we purchased is outside the city itself and is situated on 8 hectares. We plan to raise hogs and chickens as well as farm the already existing fruit trees and vegetables. We are both familiar with this type of business and hope we can utilize our skills there to provide income. We have enough retirement income to live on and we paid cash for our home, so worse case we can simply search for a new means of earning an income. We DID NOT purchase our home “site unseen” and have owned it for about four years now while hiring someone to handle the fruit and vegetable operation. This has worked quite well for us and we think we will be able to continue and improve the existing operation.

    These are the reasons we chose to go against what seems to be the prevailing wisdom. As I mention above we are prepared to shift gears in the event the need arises. I know we will face unforseen challenges so the best I can do is be both mentally and financially prepared. I would welcome any comments and will certainly appreciate any critque or advice on my plans.

    Your site offers a wealth of knowledge and insight about expat life in the Philippines I look forward with great anticipation to being a part of that life.

    I will conclude by thanking you for providing this opportunity to allow me add my 2 cents to the ongoing discussion.

    Mike

    • says

      Mike, thank you. This was such a great comment I felt I had to make an article out of it. Appreciate your thoughts very much. Godspeed.

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