Being financially savvy means spending, saving, and investing wisely on things that will matter even in the future. But a lot of Filipinos show a lack of commitment when it comes to financial literacy and competence.
According to a survey done by rating agency Standard & Poor’s, only one out of four Filipino adults is considered financially literate. The question is: How smart are you at handling your own money?
Here are five habit-forming tips from Philippine Savings Bank (PSBank) that will help you get a grasp of your budget:
Use your credit card wisely. Using your credit card, without considering your personal balance sheet is a bad habit, especially if you don’t pay your credit card bills in full each month. If you cannot control your spending behavior, you’ll end up with an unmanageable debt that might lead you to more debts.
Do not let your wants overcome your needs. Buying a fancy dress or eating out in a posh restaurant may be a little “pat on the back” for a hardworking employee like you. But doing it every payday may impede your money-saving strategy and put a dent on your bank account. Prioritize needs versus wants. At the end of the day, living beyond your means will only lead to ruing the day you exchanged financial security for these little indulgences.
Find an additional source of income. For millennials starting off in the workforce, a day job may not be enough to make ends meet. Mounting bills, pitching in at home, starting your savings, and other adulting concerns might be hard to handle on a rookie yuppie’s salary. Look for other opportunities such as tutoring high school students, going on part-time sales, or investing in the stock market.
Prepare for a rainy day. Always expect the unexpected: emergency health and housing problems, surprise layoffs, and other setbacks. Make sure to have a cushion of six months’ worth of your living expenses to survive any kind of challenge.
Seek advice. Even smart people admit that they need help at some point, and it’s no different when it comes to financial literacy. Whether you’re having trouble keeping control, or looking to add more to your nest egg, it pays to get expert opinion.
“Financial literacy—whether you are a minimum wage earner, a student, or a veteran executive—is something that we all need to take seriously,” PSBank Senior Vice President for Marketing Group Noel Tuazon said. “Our advisors will assist you on budgeting, investing, and setting goals to ensure you are able to make informed decisions and grow your hard-earned money or investments,” he added.