You work hard everyday for nothing more noble than the twice-monthly pay checks. Often, after meeting your monthly expenses, nothing remains for you to save. Unfortunately, that’s a situation easily echoed among our countrymen.
Recently, the Bangko Sentral ng Pilipinas’ (BSP) released the results of its inaugural National Baseline Survey on Financial Inclusion, and what they found was somewhat disheartening. Sure, many Filipinos are aware of banks and the role those banks can play in mitigating their financial needs—or assisting with a long-term savings plan. Most Filipinos, however, shy away due to a vague, perceived sense of inaccessibility.
In fact, many Filipinos prefer to get quick cash loans from a pawn shop or other informal lenders like the dreaded, motorbike-laden “5-6”. Living as many do on the very edge of potential hardship, it’s a very serious issue to consider. Everyone needs a helping hand and PawnHero looks at all the ways you can improve your financial situation and tone down on unnecessary expenses.
Consider the bare necessities
Ok, so this is something that everyone and your mom will likely already tell you. Most people continue to fall in the trap of overspending simply because they haven’t properly defined what exactly makes something a necessity. Precision definition is the key here.
Living expenses should be primary and you should definitely allocate for your meals for the days until your next payday—and this includes a steady supply of clean water. Exceptions to your bare living expenses are Starbucks frappes and snacks—they’re not that essentially versus a good meal. Take into consideration next how much you’ll spend getting to your workplace. Entertain the notion of getting a reloadable Beep card if you frequent Manila’s many trains or even a bus card if you work in BGC. Segregating for transportation expenses is easy when it’s stored on these cards and untouchable.
Manage your mindset
You certainly know exactly how much you make every payday. Deciding on what to spend it on becomes the core problem for many people—especially when you have things you want to buy. A way to avoid just jumping to spend on these unnecessaries is to set the mindset that you aren’t just spending on these things for that pay period. You are better served by coming up with a plan to save up slowly for these things without compromising your needs.
Consider, for example, getting a new pair of headphones. One of the things that might make it easier to spend a lot on them would be that you’re getting something long-lasting anyway. Maybe you even justify further by saying that these give you access to music that helps you focus on work. Perfectly valid reasons, right? Like we already talked about, your first priority for spending is what keeps you alive. Even if new expensive headphones might last longer and keep you chill, it really won’t keep you full if you leave nothing behind for food.
Take the 52-week saving challenge
Every start of the year, sites like Rappler usually take a look at many savings challenges that push people into regimented savings. Most of these focus on setting a fixed amount from your salary per month and keeping it stowed away until the challenge period ends. You have to, with the base challenge, set aside 50 pesos for the first week and keep adding 50 pesos to that base amount monthly. Notice, that this will mean that on the 52nd week, you have to bank 2600 pesos from your pay. It’s not going to all add up to too huge savings, but the point of the exercise is to build the habit of setting aside money you don’t touch ever.
Go for the 52-week saving challenge, and it will help you create the necessary repeating patterns you’d need to be consistent beyond the challenge. How much you initially begin with and the increments that you apply should depend on your salary and, of course, already computed costs of living. To the everyman earning 15000 to 20000 pesos, 50 pesos with 20-peso weekly increments is a perfect starting point. Another tip to help you go the distance is to take the challenge on with a friend.
Now, for the quick cash needs
Daily expenses are one thing, emergency needs are another. Say you are, in fact, better than most of us and can manage to save monthly—good on you. A quick way all that effort can be wiped out is when you need to spend a lot quickly—like the hospitalization of your daughter, an accident that you couldn’t avoid. You quickly find it’s easy to dig a deep rut for yourself when faced with emotionally-charged needs like this.
Yes, the first solution to pop to mind would be to secure a loan. Everyone’s done that at one point or another. Smart people, however, consider the best path towards securing that loan. Taking out a loan against a pawned item is the best way to go because it protects you from unnecessarily getting into debt. Once you get the funds from a pawn, yes, you risk losing your item should you default—but at least you aren’t straddled with the burden of a persistent collector and the associated stress.
Doing away with the traditional brick-and-mortar front, PawnHero conducts all transactions online. Immediate response to loan queries when you fill up our online request form makes us the fastest answer when you need that cash quick. Not only is it convenient, it’s safe too as we enlist 2GO Express to conduct the pickup of your item for pawning.
Now that any possible roadblock to your drive to save is taken care of, you can refocus on building up those savings for the future. “Essentials over everything” is all you need to keep in mind to set yourself on the right path. Responsible borrowing through pawning will then take care of those emergency needs.