One of the challenges that professionals face when it comes to handling their finances is saving. Once they receive their salaries, it is difficult to set aside money for savings compared to spending it on food, clothes, utility bills, and their other expenses as well as their wants. This challenge takes on greater importance due to the COVID-19 pandemic when it is important for people to have savings for any emergency.
According to Edric Mendoza, Registered Financial Planner and business anchor, there are several ways through which we can save better, and identified three important tips that professionals can follow in order to better manage their finances:
1. Know Your Money Personality – The first step to change is acceptance, and the same can be said when it comes to handling our finances. It is important for professionals to understand their personality and behavior when it comes to money in order for them to address it. Mendoza identifies five different money personalities on a spectrum, with some being big savers and others being big spenders.
A. Big Spenders – These are people who are lavish when it comes to their expenses, are banned conscious, and always go to high-end malls when they shop.
B. Shoppers – These people may not always spend on branded and expensive items, but they always like to shop and see it as a form of retail therapy. They always have items in their online shopping carts and are ready to check them out.
C. Clueless – These people do not spend that much and are not addicted to shopping or use it for retails purpose. However, they still find themselves overspending or in debt because they don’t have a financial plan or they don’t keep track of their spending or their income and so they are not financially informed yet.
D. Money Monk – These are the people who always save money to the point where they are not able to enjoy themselves and the money they worked hard for and sometimes end up becoming a burden to the people around them.
E. The Saver – These are the people who are able to set aside money from their earnings but are also able to have goals and work towards them. They are able to save money and enjoy it at the same time.
2. Surround Yourself With The Right People – Mendoza says that people need to identify their money personality first before they can change, and one way to change is having the right influences and the right sources of information, especially regarding your finances. Being surrounded by the right people allows you to save better and change the way you handle your finances instead of being forced to live a lifestyle that you cannot sustain.
3. Start Small – Before you can say no to big things when it comes to your expenses, you first need to be able to say no to small things. For instance, Mendoza recommends saying no to impulsive purchases for just one day, and then another, and working from there. Another example is to set aside P500 on your next payday, and then increase it in the next paydays. Being a saver is certainly a challenge, especially during these times, but it becomes more manageable and less intimidating when you start small.
For more tips on handling your finances, you can watch more episodes of FUNDamentals. For more stories for professionals, visit PLUS Network on Facebook, Instagram, Twitter, and YouTube.
