As we mentioned in the first installment of the Overcoming Spendthrift Habits series, learning how to handle one's finances is crucial in surviving one's working 20's. What use is a 50-thousand-peso-a-month salary if you spend Php 5,000 a day anyway? In ten days, you'd have kissed your salary bye-bye. Thus, it is an imperative to learn how to make sure that you'd still have enough salary left towards the end of your pay period, and not the other way around.
In the previous post, we talked about the possible root causes of one's spendthrift habits. It is by no means exhaustive, and dealing with one's spendthrift ways could entail formulating specific solutions for yourself. Either way, the goal here is to give you ideas on how to deal with your bad financial habits in a way that suits you.
Here are three general suggestions that we can give you that can get you started on the road to financial wellness:
1. Learn to make a budget. It doesn't have to be the type that only accountants can understand. It doesn't even have to follow a specific format. All you need to know are these points:
- How much you're earning in a given period
- How much you're spending within that pay period
Make sure you factor in your basic living expenses like your rent, electricity, credit card bills, food expenses, and the like. You may want to keep all your receipts and take detailed notes or remember as much of your spending as possible in the first months. That way, you'll be able to understand where your money is going.
When you've gotten these down on paper, see how you are spending: are you spending way more than what you earn? Or are you doing great and living well beneath your means? Numbers don't lie. So if you see that you have a problem, act on it accordingly. Do you need to cut back on eating out? Do you need someone to help you avoid the mall? Take measures to correct bad financial behavior.
2. Say no. Easier said than done, right? It's tough to refuse a decadent moist chocolate cake if it's your weakness. It's tough to not amble by the dress stores if it's become your after-work ritual. But you have to man up and be tougher on yourself! It's your retirement fund at stake here!
3. Fill your emotional needs so you won't go overboard on filling your material needs. It's a sad fact that shopaholism is exacerbated by stress or an unmet emotional need. Get hugs, go out with friends more, make the most out of your cable TV, and learn to enjoy nature more often. Things like these fill the heart and help you to be better able to say NO to that moist chocolate cake or that shimmery dress.
There's a practical, cerebral way to get started on your road to financial wellness. There is also a psychological and emotional way to attack the problem of spendthriftness. Find the right balance and the right approach to deal with your specific financial problems and you're set for life!
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