Managing your money is one of those things that most schools do not teach but you need to learn as an adult for you to survive in the “real” world. Unfortunately, many young Filipino adults find themselves burdened with too much debt, and most of the time it’s because they lack proper financial education.
Data from the Philippine central bank show six out of 10 Filipino adults don’t have savings. Meanwhile, many Pinoys are still unbanked, making it difficult for them to save money that they can use in times of financial stress.
Here are some tips you can follow to help manage your finances.
Before you buy, ask: ‘Do I need this?’
Learning the art of self-control when you’re at the mall or browsing through online shops will spare your wallet from unnecessary spending.
Buying things right away can be tempting especially if you can easily purchase them with just one swipe of your credit card, but it is better to delay gratification and save up money than to worry about shouldering borrowing costs. Also, small changes like making your morning coffee instead of buying one outside will eventually have a significant impact on your financial situation.
Prepare an emergency fund
In personal finance, your savings must be big enough to cover unexpected events that are financially demanding, like getting sick or recovering from a natural disaster.
Having an emergency fund will give you the financial security you need in life. But don’t let this standby money sit idly inside your safe box; put them in high-yielding savings accounts so they can generate returns. Perhaps years from now, your emergency fund will be enough to shoulder your retirement and vacations.
Be healthy and avoid trips to the emergency room
Getting sick can siphon your savings or worse, leave you in debt. Aside from living a healthy lifestyle to fight diseases that can cost you thousands of pesos, applying and paying for health insurance will help you get access to quality healthcare without worrying about hospital bills.
Track your money
Monitoring where your money goes will help you know if you are spending more than what you earn, and the best way to keep track of your finances is by budgeting. Nowadays, there are mobile applications that can help you manage your everyday expenses.
Know where to go
In the event of a financial crunch, you must know the institutions that can help you. If you have a good credit score, securing loans from banks at reasonable interest rates will be easy for you. If you’re looking for a more consumer-friendly alternative to traditional banks, there are digital lending platforms in the Philippines you can tap.
Stop living beyond your means and start investing in your future. If you’re having a hard time controlling your spending or figuring out where to put your money, you can seek the help of a financial advisor. But it’s still better for you to take charge of your finances than rely on other people.