Research shows that Filipinos are bad savers. In fact, we are said to be the worst savers in Southeast Asia. Fortunately, it is never too late to start saving. Between earning, saving, investing and spending, saving might be the hardest to do. Nonetheless, it is not that hard if we have the correct mind-set to guide us each time temptation comes.
- Need vs Want
As classic as it may seem, identifying if something is a need or want is the easiest way to avoid temptation. The key to do this is through “conscious buying.” When you pick an item off a shelf, ask yourself, “Do I need this or do I want this?” If it’s a need, then go. If it’s a want, then no. Once this simple trick becomes a habit, you will automatically see your savings increase over time.
- Know the alternatives
It is said that knowledge is power. For me, knowledge is also savings. Knowing the available alternative products and brands will allow you to find the cheapest option possible. Indeed, we all want convenience and we are willing to pay more as long as we get things quickly. However, practicing the art of canvassing, especially for big-ticket items, will surely help us reap the rewards in the long term.
- Quality over quantity
We are in the era of disposables. Not only does it hurt the environment, it also hurts our wallets whenever we have to buy a new one just because the old is of poor quality. Buy things of good quality even if they are more expensive, especially if you always use them. Now, expensive doesn’t always mean good quality. Many products out there are overpriced because of marketing costs or the brand. The key is to know which ones are durable and which ones will fail after a couple of uses.
- Buy in bulk, share the cost
Shared economy is a concept that is becoming more popular in this generation. We can use technology to our advantage when we share our assets with others for a price. Other than sharing assets, we can share our daily expenses with others. For instance, independent living is becoming a trend for millennials. The common thing to do now is to move out of the parent’s house and live in one’s own apartment or condominium. Living with our family provides us savings, as almost everything is bought in bulk. But if we live alone, it would be impractical to buy more than we need.
What we can do is look for friends who live nearby and share the cost with them. Instead of buying two rolls of toilet paper in a convenience store, buy a pack with four rolls from the supermarket and split 50-50 with your friend. This is just an example. You get the point.
- Remember your goal
Saving without a purpose is like going on a diet without a target weight. Either you starve yourself too much or you simply break your diet altogether. To prevent this from happening, make sure you have a solid goal and revisit it whenever you are tempted to buy something unnecessary.
For instance, if you are saving for your education, always remember that if you buy something that you merely want but don’t need, you forego the chance to finish your studies. You are taking one step down, instead of one step toward your goal. Always weigh both sides, but I hope your goal always wins.
Saving is not that hard once proper habits are cultivated. In a world where temptation is everywhere, we always have a choice whether these should control us or we manage ourselves to achieve our financial goals.
Aimee Rose Chua is a registered financial planner of RFP Philippines. To learn more about personal-financial planning, attend the 68th Registered Financial Planner program this March.
To inquire, e-mail firstname.lastname@example.org or text <name><e-mail> <RFP> at 0917-9689774.