Early this year, I was given an opportunity to share on personal finance to OFWs in Hong Kong through Smart & PLDT’s free publication called Smart Pinoy. I wish to share my first (and hopefully not last) attempt in writing a ‘tag-lish’ article. This is probably an article that I had to write with most difficulty and yet the outcome was not yet up to standards. Oh well, I can always try again….

*Thank you John Palanca and Greg Matubis (PLDT International) for being a risk-taker and publishing my pieces.

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Ang tamang pag-gastos

Marami sa atin nahihirapan mag ipon. Studies show that Filipinos are one of the lowest savers in Asia at ito ay isa sa pangunahing dahilan kung bakit marami sa atin ang nahihirapan sa buhay.

Alam natin na ang tanging sagot para makaalis sa kahirapan ay ang tamang pag-iipon. The most sensible advise we often give is this: “it’s not how much you make, it’s how much you save.” Ang tamang pag-iipon ay ang pinakamagandang solusyon sa ating mga suliranin sa pera.  Ang pag-iipon din ang pinaka malaking dahilan kung bakit natin iniwan ang ating mga minamahal at makipag-sapalaran maging isang OFW.  With proper savings, you can invest for the future and improve your financial condition which will eventually allow you to appreciate the fruits of your hard work.

Ngunit marami sa atin ang nahihirapan makapag-ipon kahit na lumaki na ang ating kita sa pag hahanap-buhay bilang isang OFW. Ang susi para tayo ay makapag-ipon ng maayos ay ang tamang pag-gastos. Kahit lumalaki ang ating kita pero lumalaki din ang ating gastusin, hindi rin tayo nakapag-iipon ng maayos. For us to properly save, we need to spend properly as well.

Dalawang uri ang ating pag-gastos, ito ay tinatawag na ‘needs’ at ‘wants’. Ang mga needs ay mga gastos para tayo ay mabuhay, samantalang ang mga wants naman ay mga gastos para tayo maging masaya. It is a good idea to start determining our expenses whether it is a need or it is a want. Ang mga gastos upang mabuhay (needs) ang ating pangunahing priority bago ang mga wants. Mga halimbawa ng needs ay rent, food, education, medicines – mga gastos na kinakailangan natin para mamuhay ng matiwasay. Samantala, ang mga gastusin na wants ay mga regalo, pasalubong, gadgets, shopping, sine, cell phone, load, restaurants, laruan, etc. It is important that we are aware of our expenses and categorize them according to needs vs. wants. As a general rule, needs should always be prioritized over wants.

Wala namang masama sa mga gastusin para maging masaya – lahat tayo ay nangagailangan matikman ang mga bagay na nagdudulot sa atin ng kasiyahan. Ang kailangan lang natin ay tamang prioridad. Maganda kung mailista natin ang mga gastusin at paghiwalayin ang needs vs. wants. Makikita natin sa listahan kung saan napupunta ang mga gastos natin, maayos ang pag distribute ng sahod at maitatalaga natin ang amount na pwede natin itabi kada-buwanan. If kailangan natin mag adjust para makapag-ipon ng tama, pwede tayo magbawas sa mga gastusin na wants.

Ang tamang pag-iipon, pag gastos at sakripisyo ay ang tunay na susi para sa isang matiwasay na buhay.

Here’s a truly wonderful video by Fidelity Investments on the wisdom of Savings. Many of us do not see how a a lifestyle of savings builds a strong personal economy.

I love how the lady in the video enjoyed skydiving at the age of 90!

Check out this video…

The fascination of people with lotto continues to be an enigma to me.

I once read that people who spend money on lotteries are people who don’t understand math — the probability of winning in the Lotto is so bad that it’s more probable for you to be hit by a lightning than win a jackpot. I’m not sure how true that common saying about lottery and lightning but I am certain that the probability on winning jackpots are very slim, to say the least. I stumbled upon a website on lottery probabilities and this is what it has to say on your chances: “You have better chances of getting into a car accident, plane accident, or struck my lightning, than to win your lottery.” Check out Webmath.com if you want to compute lottery probabilities. Okay, the statistics I mentioned are U.S. based so you might argue that the probability of our local Lotto will be better owing that there are fewer Filipinos compared to Americans right? Not really. “For the 6/55 grand lotto, Pulse Asia chief research fellow and statistician Ana Tabunda said it’s one in 28,989,675” — read the feature on local Lotto probabilities at ABS-CBN News.

Other than horrible probabilities, what is even more puzzling are the stories about those who do win the lottery. There have been a lot of documented information on how the majority of those who win in lotteries actually lose their money in very short periods of time. Some, even end up being in debt.

Here’s an interesting insight I picked up from the Huffington Post:

“Lottery agencies are keen to show off beaming prize-winners hugging oversize checks at celebratory news conferences, but the tales of big lottery winners who wind up in financial ruin, despair or both are increasingly common.”

“The National Endowment for Financial Education cautions those who receive a financial windfall – whether from lottery winnings, divorce settlements, cashed-out stock options or family inheritances – to plan for their psychological needs as well as their financial strategies. The Denver-based nonprofit estimates that as many as 70 percent of people who land sudden windfalls lose that money within several years.”

“Being able to manage your emotions before you do anything sudden is one of the biggest things,” said endowment spokesman Paul Golden. “If you’ve never had the comfort of financial security before, if you were really eking out a living from paycheck to paycheck, if you’ve never managed money before, it can be really confusing. There’s this false belief that no matter what you do, you’re never going to worry about money again.”

I have an interesting theory about this phenomenon on people losing a lot of money after being blessed with a windfall: If you can’t manage your money when it’s little, you wouldn’t know how to manage your money when it’s a lot (and I can personally attest to that)! In my line of work, I am constantly exposed to a lot of people’s money stories. Many of those stories revolves around how they can never seem to keep their money to save and invest despite the increase in their incomes through time. Talking to students, I would often remind them that if they can’t manage their allowances, they wouldn’t be also be able to manage their wages.

Let’s learn how to handle the little that we have so that in time, we would be ready to handle the plenty we will eventually have. The Bible says it best: Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much. – Luke 16:10, NIV