Red Line = Responsibility | Blue Line = Savings

During the earlier years of seamanship, a seafarer is generally less secure, lower income and has a high responsibility, married or single. When we get older our responsibility line should go lower and the only way to lower down our responsibility is to build our savings and investments.

Two BIG IFs in our lives.

IF a seafarer dies too soon. If we die too soon the problem is not with us because we are dead already. The problem is with the family we left behind. Imagine the burden if we do not have enough savings for our family. Their needs are permanent but our income is temporary. The same goes when we get disabled due to accidents or illness. Our income stops. That is why it is very important to a seafarer or any income earner to have a sufficient life insurance.

IF a seafarer lives too long. If we live too long, will it be a blessing or a curse? It depends. If we have built enough savings and investments that cover our entire retirement years, yes, it would be a blessing. The most expensive part of our life is not raising a new born baby or sending kids to school but "retirement." Our income has stopped already but our needs are still there. If we live or wish to live too long, we need to build our investments so we can provide our needs without working. It is called  "living on interest" LOI.

A Seafarer's CycleLogy

This has been a widespread culture and psychology of Filipino seafarers that once we started sailing, financial planning is already out of the picture. The first thing in mind when we receive our salary is getting a house, a car but what it actually means is that, "loan" a house and a car. Believe me, house and car is not an asset unless you rent that out and use the income to pay for the loan. In fact, a typical seafarer cannot afford to stay at home for long because of the mortgage he has to pay every single month. They love to spend time with their family but unfortunately they can't because of an overwhelming bills coming their way.

The comfort of having a high paying temporary income is the reason why Seafarer's CycleLogy started. We tend to neglect the fact that anything may happen. We do not wish bad things to happen but they actually do and when they do, it is not just a problem but it is a tragedy. One single major illness or accident without financial foundation could actually lose all family's savings. We might earn good money but most of us don't know how to manage it. The good news is, their is a way to stop this substandard, horrible and impractical cycle. How? Through the help of Financial Literacy.

Let us learn the basics of financial planning and cutting down unnecessary expenses so we can have more time to spend with our family. We work so hard to provide for our family's present needs and we should also make the plan to provide for our family's future needs. The greatest need of your family is not your money, but your presence. Plan ahead of time when to spend the rest of your life with them and hopefully not until you are 60 years old. A time invested in relationship especially in family is never wasted.

BUILD IT RIGHT, BUILD IT STRONG

We spent years in school learning how to work for money yet never taught how to let money work for us. Here's a blue print on building a solid financial plan. It doesn't matter if you have lower or higher income as of the moment because "time" is the greatest ally in building wealth. That is why, I highly encourage you to start investing as soon as you can.

Create a separate budget for short term and long term healthcare, for present and retirement needs. Get a term life insurance that suits your coverage. Term insurance is much way cheaper than bundled ones. Pay off debt as soon as you can especially credit card debt or any debt that has high interest rates. Save at least 3 to 6 months worth of your monthly income on a separate bank account that should only be used during emergencies. Finally, you can now start investing in stocks, bonds and mutual funds.

If you are planning to retire 10 to 20 years from now, then make it a habit to invest a certain amount every month. Investments are for long term. That is why it is important to make a solid financial plan so that any financial problems you will face, you will not easily withdraw your investments because you have enough emergency funds. Invest for a goal and a purpose, not just to make more money.