I thought all is bells and whistles after acquiring a new house. What was I thinking??
After a couple of years with my credit card debt piling up due to years in COVID-19, I recently was able to make ends meet. But then with the new house and new expenses and payables, one would think I’d go down the rabbit hole once again. I learned my lesson!
Surprisingly, despite the higher cost of living now, I am managing my finances quite well. But this is not a rags to riches story. That doesn’t happen with me. What happened was I had an epiphany and was able to rewire my brain with regards to my finances and income generation.
We are still paying for things almost the same as before but now we have more legroom in our budget to include spending for things we like to do.
Since getting the new house, fully furnishing it, and becoming acquainted with the new set of financial obligations, I have started to plan and schedule my spending, infuse new income generating hobbies, and lastly, have enough savings by the end of every month.
Managing credit in the Philippines is tough. You can go the usual route and max out your credit cards and pay for it dearly, or go deal with third party lending companies like Home Credit, Cashalo, CashG, or even get a loan from Shopee or Lazada. Personally, I haven’t tried using such apps/services, but basing from the experience with friends going bankrupt from skyrocketing interest rates from these lending companies, and then later on, personally getting assaulted verbally through SMS and email whenever my friends fail to pay on time, that is never an option for me. With that, I have relied solely in using credit card whenever necessary (and sometimes, when convenient).
USING CREDIT CARDS
Choose a good credit card company. Don’t be swayed by the high starting credit (like what happened to me). Read the fine lines. Fortunately, among the two credit cards I have, my Philippine National Bank credit card pulled through during the pandemic and gave me little to no interest making my monthly manageable. My first card company, Hongkong and Shanghai Bank Corporation, which I got way back in college, while they may not have been as considerate as my PNB Card, I realized that they have been a good reliable partner in all these years especially when we traveled abroad, I have still yet to clean my slate with them, but that is not a fault of theirs.
Bottomline is, choose a credit card for long term use. Pay on time and pay more than your monthly minimum to avoid extra charges. Sad part here in the Philippines was we were never taught properly about the use of credit cards. And to some degree, some elderlies, my parents included, downright avoided them just because they didn’t understand the terms and conditions.
You can check out PNB Credit Cards.
USING THIRD-PARTY LENDING COMPANIES
I must admit, they left a bad taste in my mouth. However, that is only because some of these third-party lending outsources collectors from unreputable agencies. They are the ones giving these lenders bad reputation. Add to the part that they violate data privacy of their clients, messaging and harassing them to a degree. That being said, I still believe there are good lending companies out there but one has to do due diligence in researching their track record before they avail their services.
You can do learn referral from friends or you can be wise and try MoneyMutual.
GENERATE EXTRA INCOME
Unlike in other countries, the labor system in the Philippines has a lot to be desired. There is little room for salary earners to earn extra as full-time job will never allow us to do part-time jobs (unless you will do it illegally and moonlight). So the best course of action is to either start a small business that won’t distract or affect your main job or start decluttering and sell some of your things you no longer use.
You can do content creation and monetize it, accept small jobs, or do garage sales or sell items on eBay, Facebook Marketplace or Carousell.
Check out eBay, or Carousell.
BORROW FROM FRIENDS
Last resort to be able to make ends meet is to borrow from acquaintances, friends or relatives. But assuming we are on the same boat, only do this when all else fails. And if you value your relationship with your relatives, avoid this at all costs.
Make it a point to lessen unnecessary expenditure every month by ten percent. You should have multiple savings (for payments, for hospitalizations, etc) for the literal and figurative rainy days. I failed to do that and learned the hard way during the pandemic.