Let’s welcome guest blogger Kyle Kam’s contribution below – see his author profile at the end of this article.
The day-to-day management of your finances is a challenge all on its own. You can never predict when something might happen to negatively impact your finances, especially when you don’t have savings or when your emergency fund won’t be enough to cover everything.
This could be one of the many signs that you aren’t doing well financially. While you could argue that you’re pretty much set in your ways when it comes to the way you handle your money, it’s something that you can change, and is worth changing.
Here are some of the signs you need to look out for.
Living paycheck to paycheck
One sure sign that you’ve got a problem handling your finances is if you always run out of money days before payday. This is a sign of poor financial management in that you should be able to manage your paycheck well enough to ensure that you have enough to last ‘til next payday.
Cut back on expensive gimik nights, and the impulse spending. Your wallet will thank you for it, and open up your finances to saving or investing. Popular investments among Filipinos include stock trading, forex, and UITFs.
Money talk is uncomfortable
If you can’t talk about money without cringing a little, it might stem from the fact that you aren’t knowledgeable enough when it comes to handling your own finances. Talking about your finances to people you feel comfortable enough around can help you out if you’re looking for advice.
Remember, even the most put-together among your friends or family has had financial issues at one point or another. Talk it over with them, and you might just find that you’ve learned a little bit more about managing your money.
You keep up with the latest everything
If there’s anything that’s a quick and easy drain on your finances, it’s dropping thousands of pesos on the latest everything when you don’t exactly need it. While there’s nothing wrong with rewarding yourself with something new and shiny, it’s a problem when it creates debt or keeps you from saving.
You can be stylish without spending on designer labels, and if you want to update your gadgets, the best way is to save so you can pay in cash instead of spending extra on credit card interest.
Trends end, or get replaced. It won’t be worth the thousands of pesos (or dollars) you spend, and the buyers’ remorse afterwards.
You’ve got a lot of debt
Everyone deals with debt at one point or another, but there’s debt that you can handle, and debt that’s spiraled out of control. If you’re at the point where you’re paying the minimum on your credit card bill, it might be time to get out.
If you’re at this point, it might be time to cut out the big spender habits, and start doubling down on your debt payments.
A retirement fund is a pipe dream
If you’re saving, that’s great. If you’ve already done away debt, that’s even better. But if you haven’t started putting away money towards your eventual retirement, then you might be facing a very broke future.
The thing is that even if you think you have enough, you need to account for inflation and other needs. Not having any plan at all is worse, and you need to get on that, because you don’t want to end up relying on siblings or children later on in life.
Getting your financial house in order requires some creative planning, and the willingness to make it happen. Your financial wellness also bleeds into your emotional and mental well-being, you’ll find that not having any money worries makes you feel lighter and less stressed.