Investing 101

With the country's growing economy and well-performing stock market, local company Pesos and Sense helps Filipinos navigate the twists and turns of investing and personal finance

What's a good investment?'' If you're like most people, you've probably asked this question at some point in your life.

But Aya Laraya, a registered financial planner, will tell you it's the wrong question to ask. ''It's like asking, 'What's a good medicine?' or 'What's a good exercise?','' he says. ''Is there just one answer?''

Laraya is the resource person and co-founder of Pesos and Sense, a company that helps Filipinos navigate the twists and turns of investing and personal finance. ''The entire point of Pesos and Sense, and the reason I created it along with Verchie (Totanes) a few years ago, is that no one teaches us what to do with our money,'' he explains. ''We're taught how to make money. Then, what do we do with the money we earn?''

A common impulse would be to put the money into a savings account. But at today's interest rates, a savings account won't earn enough to sustain a person's lifestyle, much less beat inflation. Given our growing economy and a stock market that's currently performing well, this money could actually be earning more.

People simply don't know how to take advantage of this. Laraya says, ''Up to now, they [still get] surprised-'P5,000 or P10,000 lang, puwede na ako mag-stock market (With just P5,000 or P10,000, I can invest in the stock market)?' Or, 'Mutual fund? P2,000 lang, puwede na (P2,000 is enough)?'''

'Aral Muna'

Pesos and Sense has been demystifying the sometimes intimidating world of managing and investing money since 2011. Laraya teamed up with Pesos and Sense President Verchie Totanes, a full-time entrepreneur with a background in video production. With their common passion for investment and finance, Pesos and Sense was born as a television show, which Laraya hosted, airing Saturday mornings on GMA News TV for one full season or 13 shows.

They then decided to continue their advocacy of educating people through seminars. On offer are modules on how to make your money grow, the time value of money, and how to pick winning stocks. For those living abroad, the basic module is available on the Pesos and Sense website. They also conduct seminars for companies and organizations. ''Our motto at Pesos and Sense has always been 'Aral muna bago invest (Learn before you invest).' If you don't understand what you're putting your money into, why should you put it in?'' Laraya asks.

Totanes points out that they target people with little or no background in finance or investing. True to their tagline of ''Investments made easy,'' Pesos and Sense presents ideas, concepts, and real-life examples in a way that the average Filipino can understand and apply.

The seminars are held either in the Ortigas area or in Quezon City, with more locations being planned. They're not free-but they're always full, with audiences of 80 to 100 professionals, employees, and overseas Filipino workers (OFWs), according to Totanes. Some even fly in from abroad or from the provinces just for the seminars. ''We are humbled by these people. We admire them for their enthusiasm and seriousness [in] educating themselves,'' he says.

The Hunger Is There

Pesos and Sense doesn't sell a single product or service. There's no catch to attending the seminars, and participants are always free to ask questions about different investment options such as unit investment trust funds (UITFs), variable unit-linked life insurance (VULs), and mutual funds.

The time is right for this kind of education, Laraya says. ''The hunger is there,'' he notes, especially among OFWs, who are a growing segment of their audience. They recognize the need to make the most of their money, but don't know how. What's worse, they don't know who to turn to for financial advice.

The problem is that there's no independent financial advisory here, Laraya says. So if you want investment advice, you'll most likely go to a bank or insurance company where you'll end up talking to someone whose job is to sell a specific product-not a real financial adviser who works in your interest.

Laraya uses medicine as an example: When you're sick, you go to a doctor who listens to your concerns and prescribes medicine based on your condition. You can then go to any drugstore to buy the medicine.

''Finance should work under the same paradigm,'' he says. A real financial adviser would recommend a good product that would suit your needs and shouldn't have to be the one selling it. But with no profession legally designated to give financial advice-and no standards for such a profession, for that matter-we have to learn for ourselves.

One of Laraya's dreams is to see this profession get started. ''It's badly needed,'' he stresses.

Changing Mindsets

There's not much in the world of finance that Laraya hasn't seen. Having been in the stock market since 1989, and then in banking, real estate, and insurance, he knows what he's talking about. He's seen how these different industries are all related, and how different types of investments work. He's guested on TV and radio shows, sharing his roughly 25 years of experience. But aside from all this knowledge, there's an idea that he brings to the table: ''What if we taught Filipinos how to invest in their own country?''

Laraya, who calls himself an ''investment advocate'' (''I want to advocate that this is what people should be doing,'' he says), is out to do just that. ''It's still the mindset [that] Filipinos have no money,'' he says. ''That's no longer true. Filipinos have P3 trillion in savings right now, P1.6 trillion in special deposit accounts (SDAs) alone,'' he informs.

Laraya continues, ''Can you imagine what would happen if we could convince one in 10 of these people [with savings accounts] to put up a business here by teaching them how to do it? Or by teaching them how to invest in businesses that are already here?''

For him, this would be better than foreign investment because the money wouldn't leave the country. A foreign investor comes here, puts in money, and creates jobs in the process-but eventually, he pulls out and takes his earnings with him. If Filipinos owned the businesses, the money would stay here.

Not only would the country benefit, but the money would also earn more if invested properly. The P3 trillion could be elsewhere, doing more, Laraya says. Filipinos just need to know what the different options are.

That's where Pesos and Sense comes in. By emphasizing the learning aspect of investing, the company empowers people and helps them be more responsible with their money. ''At the very least they can make saner investment decisions,'' Laraya stresses.

It all boils down to one question, which is at the core of investing: ''Gusto mo bang umasenso (Do you want to prosper)?''

If the answer to this is ''yes,'' the first-and best-investment would be knowledge, Laraya says. ''Aral ka muna (Learn first). Everything else will follow,'' he ends.