What do you usually do right after receiving your salary on payday?
Like most Overseas Filipino Workers (OFW), their salary goes straight to the remittance center. Others go to a mall and look for sales. Some would treat themselves to a lunch or dinner with friends after a month of hard work.
To OFWs, payday has to be one of the happiest days of their lives but with lots of bills to pay and other financial obligations like settling loans, mortgages, etc., payday could cause worries as you don't know how you can make ends meet. Salary day could be frustrating when the fruit of your toil only passes through your hands and had easily gone off. Just a few days after the long-awaited salary has come, you ended up broke and without savings.
Like most Overseas Filipino Workers (OFW), their salary goes straight to the remittance center. Others go to a mall and look for sales. Some would treat themselves to a lunch or dinner with friends after a month of hard work.
To OFWs, payday has to be one of the happiest days of their lives but with lots of bills to pay and other financial obligations like settling loans, mortgages, etc., payday could cause worries as you don't know how you can make ends meet. Salary day could be frustrating when the fruit of your toil only passes through your hands and had easily gone off. Just a few days after the long-awaited salary has come, you ended up broke and without savings.
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If this is your current financial condition, it's no wonder there is no room for savings and investing. Let me share with you these seven practical reminders about managing money wisely especially on payday.
1. Compensate yourself first
Many OFWs forget to pay themselves first. After spending money to pay the bills and sending money remittance, they often neglect that they also have to save for their future. When I say "pay yourself first," you should allocate at least 20 percent of your income for your investments or savings.
Before the famine in Egypt, Joseph instructed Pharaoh to keep a 20 percent of their harvest (Genesis 41:34) during the seven years of abundance. Why? Because they understood the financial principle of saving for the future. Therefore, never miss a single payday without setting aside a 20 percent of your monthly income.
2. Keep some money for emergency purposes
Imagine you had received a call from your sister in the Philippines. She said you have to send P30,000 because your father had a stroke. They need the amount of a down payment so he will be admitted immediately in the hospital. What would you do? Or maybe your 5-year old son is complaining about a severe stomachache due to food poisoning. How does it feel to have a son who is sick but you have no money to bring him to the hospital?
Build an emergency fund that is readily accessible amounting 3-6 months worth of your monthly expenses. An emergency fund allows you to continue your current lifestyle without going into debt. Having an emergency fund will also help you to reduce stress.
3. Settle your bills promptly
Be responsible with your financial obligations — car loan, electric bill, house mortgage, etc. You will avoid unnecessary financial worries and pressures if you know how to budget your hard-earned money wisely. Note down all the bills you have to pay each month, the respective amounts and due dates. You can automate these payments to ensure they are all paid on time and avoid extra charges or penalties for late payments.
4. Pay your debt
If you have an outstanding loan or debt, be sure that you are able to fulfill your promises to the lender by paying them on time. Doing so will protect your integrity as a borrower. In addition, learn to set a financial goal by having a clear plan and time frame to free yourself from financial bondage sooner.
5. Secure a health and life insurance
Sad to say, many OFWs don't have health or life insurance. If they have, usually they are not comprehensive. Therefore, it is essential to re-evaluate the policies and riders whether you are adequately protected. If not, you might want to consult a registered financial adviser to upgrade your insurance. In addition, check the mode of payment of your insurance whether they are monthly, quarterly, or annually and ensure you pay them on time.
Remember, the best investment for OFW is not the real estate or shares of stocks, but having good health. Your greatest investment is YOU so you have to be protected especially if you are a sole breadwinner or have dependents back home.
6. Share your blessings
God’s financial plan is balanced. He has given us the primary responsibility of caring for our own family and relatives and ensure to meet their financial needs. As a responsible breadwinner, the ultimate purpose why you leave the country is to help them and extend your blessings.
However, don't forget to save for yourself and let your family know about your own financial goals.
7. Be a good steward of God's blessings
God is the ultimate source of blessings. All That you have may it be your health, skills, and talents are all coming from Him. Unfortunately, money has the power to lead us away from God, whether we have it or we lack it. However, a faithful steward manages his time and money wisely and ensure that he never forget to honor Him by returning tithes.
Honoring God with your wealth means to be a cheerful giver instead of a hoarder and greedy.
1. Compensate yourself first
Many OFWs forget to pay themselves first. After spending money to pay the bills and sending money remittance, they often neglect that they also have to save for their future. When I say "pay yourself first," you should allocate at least 20 percent of your income for your investments or savings.
Before the famine in Egypt, Joseph instructed Pharaoh to keep a 20 percent of their harvest (Genesis 41:34) during the seven years of abundance. Why? Because they understood the financial principle of saving for the future. Therefore, never miss a single payday without setting aside a 20 percent of your monthly income.
2. Keep some money for emergency purposes
Imagine you had received a call from your sister in the Philippines. She said you have to send P30,000 because your father had a stroke. They need the amount of a down payment so he will be admitted immediately in the hospital. What would you do? Or maybe your 5-year old son is complaining about a severe stomachache due to food poisoning. How does it feel to have a son who is sick but you have no money to bring him to the hospital?
Build an emergency fund that is readily accessible amounting 3-6 months worth of your monthly expenses. An emergency fund allows you to continue your current lifestyle without going into debt. Having an emergency fund will also help you to reduce stress.
3. Settle your bills promptly
Be responsible with your financial obligations — car loan, electric bill, house mortgage, etc. You will avoid unnecessary financial worries and pressures if you know how to budget your hard-earned money wisely. Note down all the bills you have to pay each month, the respective amounts and due dates. You can automate these payments to ensure they are all paid on time and avoid extra charges or penalties for late payments.
4. Pay your debt
If you have an outstanding loan or debt, be sure that you are able to fulfill your promises to the lender by paying them on time. Doing so will protect your integrity as a borrower. In addition, learn to set a financial goal by having a clear plan and time frame to free yourself from financial bondage sooner.
5. Secure a health and life insurance
Sad to say, many OFWs don't have health or life insurance. If they have, usually they are not comprehensive. Therefore, it is essential to re-evaluate the policies and riders whether you are adequately protected. If not, you might want to consult a registered financial adviser to upgrade your insurance. In addition, check the mode of payment of your insurance whether they are monthly, quarterly, or annually and ensure you pay them on time.
Remember, the best investment for OFW is not the real estate or shares of stocks, but having good health. Your greatest investment is YOU so you have to be protected especially if you are a sole breadwinner or have dependents back home.
6. Share your blessings
God’s financial plan is balanced. He has given us the primary responsibility of caring for our own family and relatives and ensure to meet their financial needs. As a responsible breadwinner, the ultimate purpose why you leave the country is to help them and extend your blessings.
However, don't forget to save for yourself and let your family know about your own financial goals.
7. Be a good steward of God's blessings
God is the ultimate source of blessings. All That you have may it be your health, skills, and talents are all coming from Him. Unfortunately, money has the power to lead us away from God, whether we have it or we lack it. However, a faithful steward manages his time and money wisely and ensure that he never forget to honor Him by returning tithes.
Honoring God with your wealth means to be a cheerful giver instead of a hoarder and greedy.
