We’ve all had our share of financial ups and downs. That is because of the reality that managing your finances, while absolutely necessary, has never been easy.
Some failures root from the mindset that working hard entitles one to roll on a high budget. What is barely realized by most is that every peso that goes through your palm could have grown if sensibly spent.
Experience is the best teacher, says the old adage. But it is better to be wise up ahead of financial roadblocks than learn how to handle your money the hard way. Below are the top money mistakes every Filipino should avoid:
1. Not building an emergency fund while you can.The worst emergencies happen when you least expect them. Accidents, calamities, sudden loss of job, and illnesses can hurt your finances badly. An emergency fund serves as your backup when mishaps get in the way.
2. Not saving before spending.
Instant gratification is a silent killer. While it’s rewarding to give it to your urge to splurge time and again, developing it into a nasty habit may burn a permanent hole in your pocket. Set a daily budget and do not spend your income just for one occasion.
3. Being a “debt collector.”
Spending your life paying for debts is no fun. Debts can compromise your other needs and obligations–do not fall into this vicious cycle.
4. Being a dedicated follower of fashion–to a fault.
Do not risk emptying your pockets just to join the bandwagon. Trends constantly change that is why it is better to invest in items that will benefit you in the long term. Buy items that are always in-style and durable.
5. Not having a clear career path.
Choose a profession that you are not only passionate about, but also sets you off to a clear career path, and learn to cope with the workload. Finding a job these days is difficult, but is still better than having no source of income. If you want to leave your job, make sure you have a fallback.
6. Letting opportunities slip away.
If you have the capital and the concept, brave the odds and take the risk. Success can only be realized when you try.
7. Refusing to invest in yourself.
You are the most important asset you have. Attending trainings, seminars, or getting an MA or Ph D. can add up to your value. Capitalize on constant enrichment of one’s self for an impressive resume and remarkable skill set.
8. Not future-proofing the family.
It is inevitable that our parents will age and retire in time. Sickness may come along with aging too, which might take a toll on your budget. Ensure their needs will be sufficed in the future by getting them a health insurance.
9. Choosing a car over an appreciating asset.
Never force yourself to purchase an automobile if doing so will only leave you empty-handed. Opt for car pool or mass transit in the meantime while you are saving money. Your dream car can wait.
10. Aside from losing money, I also lost a friend because of my long list of debts.
Debts can ruin relationships so avoid incurring some. Lend only in times of emergency and promise to pay on time.
Do not be impulsive about your financial decisions to avoid major money mistakes. Remember: As long as they’re done with good intention, mistakes are not a matter for shame, but for learning.