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Time Value of Money: How to Determine the Value of Money with Respect to Time

Money received today is more valuable than the same amount of money a year from now. It is essential to understand the relation between mone...

How Much Do You Need to Retire Wealthy

Almost everyone wants to retire wealthy. There are those who think that their SSS pension is sufficient to handle all their expenses and live a comfortable life when they reach their golden years. Sadly these people only see the the truth when they realize their SSS pension is barely enough to pay for medical expenses. If you are asking yourself how you could possibly retire wealthy when you only earn a meager income.

There are 4 main factors to consider when it comes to building wealth. Income you generate, Portion of your income you set aside for yourself, Duration of building your wealth and Type of Investments you use in growing your money. Each of these factors affect one another and for most of us we usually have one factor we consider to be our weakness. You need not worry about your deficiency since you can compensate for the deficiency on the other factors I mentioned.

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What is "RICH" in the Philippines

One of the reasons I started this blog was to share the knowledge I learned about accumulating wealth. I regularly read books and other blogs to learn and improve my financial knowledge. In order for me to make a sound plan on achieving my financial goals I must first determine specific numbers that I must attain.

According to a study by the NSCB back in 2010, a family who has an annual household income between Php 295,000.00 - Php2,400,000.00 is considered middle class while an annual household income above Php2,400,000 is considered rich. If we take inflation into account these values will be an annual household income of Php 340,000 - Php 2,770,000 for the middle class and above Php2,770,000 for the affluent.

The study however does not mention any criteria regarding the age and Net Worth of the person. One method of determining the average net worth required is by using the TARGET NET WORTH FORMULA from the book "Millionaire Next Door". Below is the formula for the TARGET NET WORTH of an AVERAGE ACCUMULATOR OF WEALTH (AAW)


In order to be considered wealthy, a person must become a PRODIGIOUS ACCUMULATOR OF WEALTH (PAW) and must have double the target net worth of the AAW.