I know you went abroad to find a greener pasture for you and your family. You went out of the comfort of our home country and braved the uncertainties of life abroad. You went there with the hope of finally elevating your family’s life out of poverty and become financially stable and free.
Unfortunately, many still ask: Why am I still financially broken even after working for so many years abroad?
Anyone would respond to this question almost the same way: BAD MONEY HABIT.
Or maybe, you were simply not earning enough. Maybe your family’s needs were far too great your income couldn’t cope with it.
There are many ways of looking at it, unfortunately, for most, it’s plain and simple: BAD MONEY HABIT.
In this article, we will talk about some of the worst money habits most of us develop. And then I offer a brief solution.
1. You do not know how to handle money.
According to a survey by Standard & Poor, only 25% of Filipino adults are financially literate.
So, that means, 75% are financially illiterate.
What does that even mean anyways?
Well, for starters, financial literacy pertains to the basics of handling money wisely and intelligently. Sounds easy, if you ask me.
Unfortunately, it isn’t, in real life.
Of course, other than the ‘piggy bank’ strategy, most Filipinos never learned anything about personal finance in school like the importance of saving, thrift values, and basic investing.
So, can you do anything about it? Are you sure you are financially literate? Well, if you are still cash-strapped after working for so many years abroad, well, you probably are illiterate. No offense meant. But you you can something about that.
HOW TO FIX THIS:
Read and learn everything there is to learn about managing your personal finance. Most importantly, ACTIVELY APPLY what you learn EVERY SINGLE DAY.
Remember that learning how to do stuff, but not doing the stuff you learn is basically USELESS.
Invest in a good finance book that will teach you how to manage your finances. You can also read the tips and advice of some Filipino financial gurus which are often for free. By being financially literate, you also become informed on how to identify and avoid quick-rich-money-scams or questionable investments.
2. You love debts (perhaps a little too much).
For starters, most Filipinos are left with no other choice but to go abroad and work because of too much debt incurred back home to begin with. Before they even started getting their first paycheck, they are already have a lot of debts.
The first few or several paychecks will, of course, be consumed to pay off the debts incurred back home.
In some more undesirable cases, the idea that a family member has already gone to work abroad prompts some families to splurge even before receiving money from their family member working abroad. What do I mean by this?
There are cases when OFWs (and their families) feel that they have the power to purchase the things they have wanted for so long. They start borrowing money just to buy stuff that bring instant gratification like furniture, appliances, computers and electronic gadgets with the premise that their soon-to-be-OFW will be earning a lot money and will be able to pay it at some point.
That is the deadly side effect of having a steady job and a good paying one at that: You think you will have a job forever and that money will steadily flow.
This is called “income permanence perception” in economic. And this belief sometimes lead people to make poor financial choices.
They think it’s okay to loan big amounts of money thinking that “we can pay it off, I’ve got a job”. And then they’d do it again, and again, and again, until a labor crackdown happens and ends up without a job, and just debts.
AVOID THE DEBT TRAP BY ALL MEANS.
Borrow money only and only when it is necessary and important! Again, ONLY WHEN IT IS NECESSARY AND EXTREMELY IMPORTANT.
Don’t borrow money to buy luxuries (things you don’t need). Moreover, do not borrow money just to pay off another debt! This is the most common financial mistake known to us. If you do this, you will fall in the cycle of debt!
Follow and practice this mantra with your family: If you don’t have any money, you should not buy anything.
OR, you should not buy or spend on things when you don’t have the money.
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