Money matters

Let’s set things straight, money shouldn’t rule us. We shouldn’t obsess over how much we make but at the same time, we should always respect the role it plays in our lives. Contrary to what some people might say, money doesn’t make us happy, our choices do that for us. What money does give us is opportunity. And in my opinion, the more opportunities we have, the more we also have a chance to share that with others if we play things right.

Luckily for me, I’ve always liked money and numbers. When I was in primary school, math turned out to be my best subject and that trend continued until college. It was actually that rare mutual relationship with mathematics that helped me create some sort of direction during my college years. I had actually decided that I wanted to work in the financial industry — I think I set my sights on working for an international bank or maybe even the World Bank.

Obviously enough, that didn’t happen. I ended up in the entertainment industry, crying and emoting my way through an acting career. Although, even if I landed in such a different job, my love for numbers and finance has still become very useful.

Being financially aware has really taken a huge load off my back. Doing my budgets, handling my money and knowing where to invest and how to make it grow are activities that I enjoy. Basically, I like doing what others hate. I have friends or relatives who choke at the thought of having to account for things so I guess it’s a blessing that I’m into it.

So far, I’ve done most of financials on my own, except for the taxes and nitty-gritty paper work that accountants would be better off doing. From all my experiences, I’d like to share some of the things I’ve learned along the way. I know there is so much more for me to discover but so far, these tips have really helped me stay financially healthy.

1. Keep track of everything

From expenses to earnings, you should always know where your money is going and where it is coming from. You can do it old school by writing it down but I suggest using an app on your computer. This helps because it’s impossible to determine your financial situation if you don’t know where it’s going. You can’t expect to keep track of your finances if you don’t have a record for reference. By keeping track, you are more aware of your means, it’s easier paying for stuff like taxes and you have more confidence in what you can or cannot do.

(Note: I used YNAB 4 to record everything. Check it out on www.YouNeedABudget.com.)

2. Make a realistic budget

Honestly, a lot of people fail to follow their own budget but that doesn’t mean it shouldn’t be done. Even if we aren’t able to stick to our budget, we are giving ourselves a better idea of what we can spend on for the month. Of course, there will come a time that you will have to stick to it, but the most important part is the discipline of trying and turning it into a habit. Eventually, the benefits will slowly appear.

3. Save!

It’s simple — one word and four letters. Save! There will come a time when you have a family. There will be moments when you suddenly need to settle an unplanned medical bill, purchase a costly item or invest in a great product. The only way you can pay for those is if you save. There have been so many theories on how to save. Some have said that you should save monthly while others save big chunks of their cash once a year. Regardless of your saving style, you should plan out your savings, set a goal and make sure you meet it.

4. Learn how to make your money grow

This tip might seem daunting but it’s become increasingly easy to learn more about your investment options. Don’t be afraid of banks because they will be more than willing to showcase their products that can help you grow your money while there are numerous Philippine-based blogs that have articles for newbie investors. Gone are the days when you need a lot of money or need to be an expert to invest. The chance to learn is there, you just have to try it out.

(I find www.PinoyMoneyTalk.com to be a great resource for newbies and non-experts when it comes to this topic.)

5. Make yourself happy with what you earn!

You work so hard for your money. You sacrifice and put a lot of energy into making sure you earn enough. With that, don’t ever be afraid to spend on something to make yourself happy. If you have a choice between buying dessert or saving money, then I say you go for the dessert because that’ll make you feel awesome. I was talking to some friends a while back and we agreed that earning money allows us to live comfortably, especially if you are doing well at work. It’s important to reward yourself, especially when it comes to the little things. Personally, I splurge on iPhone games (P40) and snacks (ice cream — P50). When I see something I want, I’ll just buy it without hesitation. At the end of the day, I can only eat and play games so much but it makes me extremely happy.

(Note: Don’t go on splurging on expensive things all the time! Minimal cost but maximum happiness goes a long way.)

(For any comments or suggestions, e-mail me at [email protected]. Follow me on Twitter @mikaeldaez.)