Earnest Stories highlights the money and investing experiences of experts, individual investors, and non-investors alike. Watch the full episode here.
With many years of banking and finance experience under his belt, teaching money management and investing is second nature to Andoy Beltran.
After all, he heads the Digital Solutions and Investor Engagement division at First Metro Securities. Still, Andoy doesn’t consider himself an expert, and for good reason.
“I think the moment I start thinking that I’m already an expert parang learning stops eh,” he said.
In this interview, Andoy highlighted the importance of financial literacy as he identified common investing mistakes and misconceptions as well as steps for building financial wellness.
Have you had an investing decision that you ended up regretting?
Recalling his investing mistakes, Andoy answered, “Most of them came in the form of me being emotional when it comes to decisions, me following social media hype, or perhaps me engaging in FOMO-centric (fear of missing out) decisions.”
“I thought I needed to join the bandwagon, instead of me focusing on what I really know, focusing on what I really want, and focusing on what I truly understand,” he added.
With a lot of noise influencing people’s decisions, it can be challenging to not let feelings like fear and overenthusiasm get the best of you, especially when money is involved.
Whether you’re a beginner or an expert investor, it’s essential to keep your emotions in check and avoid biased decision-making.
When people ask, “What’s the best investment?” what do you tell them?
“Inasmuch as it’s going to make life easier for us, there’s really no such thing as a one-size-fits-all approach, no such thing as a perfect investment,” said Andoy.
“It really boils down to your fears, your experience, your exposure, objectives and sometimes even time horizon.”
For him, it’s a red flag when a supposed investment professional oversimplifies investing to sell a product.
“You know that you are dealing with an investment professional when they are the ones who keep on asking questions. They’re not the ones who keep on pitching; they’re not the ones who keep on selling stuff.”
He also shared that a good investment professional asks questions so that they’ll understand their client’s situation and be able to recommend the right options.
What is the clearest sign that someone is good with money?
Andoy believes a person is good with money when they don’t look forward to the next payday. “They’re of good financial standing if they’re not heavily dependent on the next income stream, the next sweldo.”
Explaining further, he noted that confidence and money mindset are tell-tale signs.
“You know that someone is confident when it comes to financial decision-making when they’re not overwhelmed with the absence of money or the abundance of money.”
For him, confidence is seen in the way you handle financial decisions like, “Where am I supposed to put this [money]?” “Where am I supposed to invest this?” “Am I even supposed to invest?”
What’s a popular piece of online financial advice that people should actually ignore?
To be confident about money decisions, knowledge is important. Educational resources are now more accessible than ever, but this can be a double-edged sword given the amount of misinformation online.
Asked about money myths he’d like to debunk, Andoy answered, “Two things come to mind. The first one being, ‘Don’t spend on wants.’”
“But, if you’re going to look at it, when we spend on wants, that’s when we are at our happiest. It’s really all a matter of prioritizing,” he shared further.
Instead of telling people not to give in to wants, Andoy advocates for the 50-30-20 budgeting strategy.
He believes this method can allow you to cover your needs, and save and invest, “and at the same time take care of your sanity.”
According to Andoy, another misconception is that “when you have a property, and it’s not giving you rental income, it’s supposed to be considered a liability.”
“In truth and in fact, real property – whether it’s for personal use or for business purposes – real property just tends to appreciate in value over time.”
What’s the best way to build financial wellness?
For finance professionals like Andoy, it’s easier to encourage people to invest when they feel confident and secure.
He shared simple steps people can take to gain that confidence and feeling of security.
“Investing is just, maybe step 3,” noted Andoy. “Step 0 is being financially literate. Step 1 perhaps is having control of your money by having a budget.”
“Step 2 is building your emergency fund so that if and when something happens – a calamity, a crisis, an unexpected expense – you don’t spend money intended for tuition.”
Andoy stressed the importance of having the right mindset when a person is finally ready to start investing.
“You don’t invest just because people are talking about it. You don’t invest because it sounds cool. You invest because, again, you understand what you’re getting yourself into.”
“Investing should be able to help you tick those life goals, 1 item at a time.”
