How we spend, save may help us survive
“Our actions with money should incorporate wisdom, and not just reflexes.”
This thought comes to mind as the world reels from an economic slump that has paved the way for mass layoffs—warning signs that everybody should brace himself for the tough times ahead.
Frank Hanna, a leading Catholic entrepreneur and author of the book “What Your Money Means and How to Use It Well” says “too many of us are not thoughtful enough in the way we behave with our money. If we understand our money correctly, it becomes a force for good in our lives, rather than a source of anxiety or downfall.”
He argues that money is not a necessary evil.
“It is a gift from God that is frequently abused because of our lack of understanding of its proper use,” he says.
The Filipino adage kapag maigsi ang kumot, matutong mamaluktot (when you’re given a short blanket, learn how to curl up), and the habit that requires one to tighten one’s belt (maghigpit ng sinturon) are timely and applicable.
Financial experts are one in saying that everyone should stay vigilant, save, live within (or better yet, below) your means, and put a stop to bad habits (like drinking and smoking) that drain your income and savings.
Here are some practical tips on how to prudently spend or save money:
Slash spending. Cut back on nonessentials by distinguishing between needs and wants.
Pay your debts and don’t spend money you don’t have. (Read: Go slow on that credit card.)
Stick to your budget. Those envelopes for monthly bills and expenses will help you manage your budget. Keep track of how much money is going out and how much is coming in and how much you have left.
For those lucky enough to have a job, save for an emergency fund that can cover basic living expenses for three to six months and expenses for illness or emergency. Set a goal to save for this fund within a year.
Consider your emergency fund a bill you have to settle. Open a separate account just for this fund. Once you have saved enough for this fund, consider moving it in higher-yielding investments (such as time deposits or mutual funds) so it will earn higher interest.
Despite the gloomy economic forecast, the good news is: Filipinos are a pliant and persevering lot. They scrimp if they have to or make do with what they have.
Their sense of sacrifice—as in the case of overseas workers—for the welfare and well-being of loved ones escapes many Westerners.
They cope with the hard times and keep their sanity by believing that things will turn around through dint of hard work, prudent use of their earnings, and trust in Divine Providence.