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10 Filipino Habits That Impact Your Finances

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Ever notice how some habits stick with us no matter how much we try to shake them off? Like how your lola insists on keeping every Tupperware container “just in case,” or how your barkada swears by buying “sulit” deals even when you end up with a closet full of things you don’t need?

Everyone has quirks, but some Filipino habits can significantly impact money management. Some habits help stretch your pesos further, while others quietly drain your wallet.

Whether you’re a millennial juggling a family and career or a Gen X’er running your own business, understanding these habits can give a fresh perspective on your finances. 

In this article, we’ll explore Filipino habits that affect your bank account, examining how you save, spend, and manage debt.

5 Bad Filipino Habits Affecting Your Finances

Some habits seem harmless but can add up over time, especially when it comes to money. Here are some of those that you should be aware of and avoid:

1. Leaving budgeting to wives

In many Filipino households, budgeting is often the wife’s responsibility. While it might seem practical to delegate this task, the real issue isn’t who handles the budget—it’s ensuring that a budget exists and is actively managed.

When only one person manages the budget, it can lead to financial imbalances and a lack of transparency between partners. If both partners aren’t involved, financial goals and spending habits might not align, leading to potential conflicts or misunderstandings.

To remedy this, budgeting should be a joint effort. Both partners should track income and expenses and set financial goals together. This way, all perspectives are considered, and financial decisions are made collaboratively.

2. Living beyond one’s means

Credit cards are now a staple payment method in the Philippines, especially for online shopping. However, their ease of use can sometimes lead to overspending. If you frequently carry a balance and cannot fully pay your credit card, you might be living beyond your means.

Accruing credit card debt can result in high interest charges and financial strain, indicating that your spending exceeds your income. This can lead to severe financial stress and debt accumulation.

To manage this, keep a close eye on your expenses and make sure you’re not spending more than you earn. Utilize financial tracking apps to monitor and manage your expenditures and set up reminders for payments.

Aim to pay off your credit card in full each month to avoid interest. If you already have substantial debt, consider a collateral loan to consolidate and manage your debt more effectively.

3. Making children their retirement plan

Many Filipinos struggle with retirement planning and may rely on their children to support them in old age. This approach can place undue pressure on the younger generation and reflects a lack of personal retirement planning.

Depending on your children for support can strain relationships and create uncertainty about your future. To ensure financial independence and stability in your later years, you must have a retirement plan.

Begin saving early to build a sufficient nest egg, and explore investment options to grow your savings and secure your financial future. 

4. Confusing “kuripot” with “matipid”

Being “kuripot” often means being stingy and denying yourself basic comforts, whereas being “matipid” involves spending wisely and managing money effectively. Understanding this difference can help you strike a better balance between saving and spending.

Extreme frugality, or being kuripot, can negatively affect your quality of life and prevent you from making worthwhile investments. While saving money is essential, excessive stinginess can lead to missed opportunities and increased stress.

Identify areas where you can cut back on expenses without compromising your well-being or neglecting necessary loan payments. Allocate funds for investments that will benefit your future rather than hoarding money unnecessarily.

Remember, spending isn’t inherently bad. Investing in slightly higher-quality products can save you money in the long run. Balance saving with enjoying life by treating yourself occasionally within your budget. This approach helps you maintain your overall well-being and enjoy the rewards of your financial discipline.

5. Relying on “suki” relationships for discounts

In the Philippines, many people rely on “suki” (loyalty) relationships to get discounts or special deals from local vendors. While this can offer savings, it can also result in financial decisions driven more by personal relationships than by sound economic reasoning.

Relying on suki relationships for discounts might lead to overspending on unnecessary items or emotional purchases. 

Instead, prioritize your purchases based on necessity and value rather than discounts or personal connections. Use comparison tools to find the best deals and ensure that each purchase is a wise decision.

5 Good Filipino Financial Habits You Should Adopt

Over time, smart financial decisions can have a big impact on your financial health. Consider implementing these practices:

1. Practicing “pag-iipon”

Filipinos are known for practicing “pag-iipon” or saving money, often setting aside a portion of their income for future needs or emergencies.

Regular saving helps build an emergency fund, reduces financial stress, and provides a cushion for unexpected expenses like preventing property foreclosure. It also enables you to invest in opportunities and achieve long-term financial goals.

To develop this habit, set up automatic transfers to your savings account to regularly save a portion of your monthly income. Keep yourself motivated to save by defining clear savings goals, such as for emergencies, travel, or retirement. By doing so, you can stay focused and committed to your financial well-being.

2. Engaging in side hustles

Filipinos often engage in side hustles or “rakets” to supplement their income. These activities can range from selling homemade goods to freelancing or offering various services.

Having multiple income streams increases financial security and provides extra funds for savings or investments. Side hustles also allow you to use your skills and passions to earn additional income. 

To set up your side hustle, identify skills or hobbies you can monetize. Consider offering freelance services, selling products, or teaching a skill. Some people take out collateral loans to start and then gradually pay them off as they earn. Use your extra income to pay off debt, save, or invest.

3. Practicing frugality and being “matipid

Being “matipid” or frugal is a positive financial habit that involves spending money wisely and within your means. This habit differs from being “kuripot,” which means being stingy.

Practicing frugality helps you live within your means and increase your savings by encouraging mindful spending and prioritizing critical expenses over unnecessary ones. 

To cultivate this habit, focus on purchasing essentials and avoid impulse buys. Make lists before shopping to stay on track. Look for cost-effective alternatives to expensive items or activities, such as DIY projects, second-hand shopping, or free community events. This approach helps you save money while still enjoying a fulfilling lifestyle.

4. Investing in education and skills

Filipinos highly value education and continuous learning. Investing in education and skills can lead to better job opportunities and more income. Enhancing your knowledge and skills opens up new career prospects, improves earning potential, and helps you stay competitive in the job market.

Consider joining courses or programs to enhance your skills and qualifications or obtain professional certifications to boost your resume. This investment in yourself can lead to long-term financial stability and career growth.

5. Utilizing financial planning tools

Using planning tools and resources can greatly improve your financial management. Budgeting apps, investment platforms, and financial advisory services provide a clear picture of your financial health.

Budgeting apps can help you track income, expenses, and savings goals—many of which are available on your phone’s app store. Additionally, seeking advice from financial advisors can help you create a personalized financial plan tailored to your specific needs and goals.

Embrace Better Financial Habits

From avoiding pitfalls like living beyond your means and relying on children for retirement to adopting beneficial practices such as regular saving, engaging in side hustles, and practicing mindful frugality, your financial habits can have a big influence on your wallet.

The key takeaway? Regularly evaluate and refine your financial habits. Embracing positive habits while avoiding detrimental ones can secure a stable future for you and your family.

Looking to boost your financial security? Prioritize smart saving and spending to build a solid foundation and reach your long-term goals. For additional support, get in touch with Asialink Finance. Our flexible loans can help you achieve your dreams for the future—such as reclaiming a repossessed property—without compromising your financial health.

Contact us today for more information.

Lou Lobrin

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