Money tips: Don't splurge, use things sparingly
abs-cbnNEWS.com | 07/02/2009 1:52 PM
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MANILA - The temptation to spend for things you want is very high when you are browsing through a grocery's shelves or walking through a mall.
Often, this is the way a household's expenses are bled out slowly until there is none left at the end of the month.
Finance journalist Salve Duplito said that if you want to save and manage your income properly, don't clutter your home with unnecessary purchases.
"We just have too many things to buy. You're so tempted to buy a lot of things, especially if you have income. But you don't have to buy all the things that are in the stores," she said in an interview on ABS-CBN's "Shoptalk" aired recently.
She shared several tips on saving your money, but at the same time enjoying it.
1. Use things sparingly, caringly, and carefully.
Don't go to the grocery before your scheduled trip. This minimizes excess spending and lets you stick to your budget. Although making unplanned trips to the grocery messes with your routine, Duplito said the real risk is spending more than your allotted budget.
"It's less about sticking to a certain schedule on a specific day, but more about using only a certain amount of budget for this period," she explained.
To avoid unnecessary grocery trips, Duplito said the trick is to stretch the products you have on hand instead of rushing off to buy particular grocery items.
"In your recipe, suppose you need cooking oil. Instead of buying oil, use what's in your pantry, like butter. The challenge is substitution. Be creative," she said.
It's also good to train your children (and spouse) to take care of their things. This way, you save on buying replacements for a child's ruined notebook or repair costs for your spouse's shoe. "If they know these things are blessings, they'll take care of it," Duplito said.
Finally, a principle to live by is, if you have maids, don't over-delegate. This way, you stay in charge of your household and you can keep tabs on what is and is not a necessary expense.
"When you're so busy with what you're doing, puro maids na lang. Sometimes, they tell you, 'Ate, this is destroyed.' But you don't know someone else has already bought a replacement. Especially kitchen and TV equipment," she said.
2. Know your numbers.
Duplito said it is useful to create and use a "spending plan" that works for you, one that is realistic and you know you can meet. "Personally, I don't prefer the word budget because you feel like you're constricted, so I don't stick with it. I call it a spending plan," she said.
A smart way to manage your household expenses is to set up a separate bank account for your monthly expenses. Separate this from your salary ATM or joint accounts so that you are not tempted to overspend at any given time.
"For example, when you're going to the mall, you think the kids need new bags. But you look at your expense account and you only have this much. Immediately, you know, you can budget that for the next month," Duplito explained.
Another way to save smart is to anticipate annual balloon expenses so that you can adjust our spending plan accordingly. An example is car maintenance, which costs about P70,000 a year for average Filipino households.
Duplito said it is good to ensure that you have the money to pay for this by planning ahead. "What you do is you anticipate for big expenses during one year, and then you budget that monthly so it doesn't hurt your pocket," she said.
3. Enjoy yourself.
Finally, an oft-forgotten principle when managing household expenses is to fill your life with other things besides monetary fulfillment.
"We talk about money all the time. We preach, but the truth is, this is just a small portion of our lives," Duplito said.
She said that life should be about balancing money matters with more important life goals. "Money should not come before relationships, service, faith, or whatever. It will overcome your life if you don't manage it. So the important thing is balance," she said. -- by Kristine Servando, abs-cbnNEWS.com/Newsbreak
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