Overcoming money beliefs, what we think and say about money matters.
A wrong money mindset isn’t just a bunch of random thoughts, it’s like hardwired mental programs. After years of thinking, doing, or avoiding the same things, an unhelpful money mindset can sabotage even our best attempts at getting our financial lives on track.
Some Filipinos don’t save and invest their money because of fear. Once you have fear and it becomes a belief, a belief then becomes a habit and the worst part is we pass it along to the next generation. A lot of things can go wrong if we have these beliefs.
1. Fear of having nothing.
We feel that our money is not enough to save, but is really not enough? or are we just not spending it wisely? As our income grows the expenses grow too!
We think about expenses first before we think about saving when actually it should be the other way around. When we receive our income or salary we should save before we spend, set aside a portion for the future.
Live within your means, rich people are rich because they are thrifty and provident, they prepare for the future. Like them, we should have an abundance mindset. these people focus on the limitless opportunities available in business and life. They choose to focus on the positive things in their life rather than the negative things.
People with an abundance mindset are more grateful, more creative, and focused on collaboration. As a result of this abundant mindset, they attract opportunities, people, and creativity into their lives.
2. You are Bad with Money and don’t know How to save
How many times have you been out with family and friends and when the topic of finances comes up, someone jumps in and says ’I’m bad with money?”. If you think and believe that you are bad with money you’re probably right. But don’t you see what the problem here is? It’s your thinking, you accepted and believe that you have no control over your money.
The first step in taking control of your finances is to change the language around how you describe yourself. Now I challenge you, flip the script, instead of saying “I’m bad with money,” you should say: “I haven’t yet learned the skills of managing my money, but I’m going to,” take control now.
Make it a habit, create an action plan. Instead of a Starbucks coffee make a regular coffee, save first before you spend. Talk it out with your family and friends. Surround yourself with people that can help you save and learn from them.
This is the best time to learn in the history of mankind, we are on the information age, anything you want to know is on the internet and is one click away. If you are still confused or disorganized with your finances or investing watch educational videos, read books, contact a financial advisor or StockBytes PH, Google, or Youtube search your money question, etc. Don’t be afraid to learn something new.
3. I have a mountain of Debt
“I will not save because I need to pay my debts first”
We got into debt because we have the wrong mindset and we don’t save. Our emergency fund is our first shield to debt if we have the right habit of saving before spending it will be easier for us to build a solid financial foundation.
“We buy things we don’t need with money we don’t have to impress people we don’t like”
You must have heard of this quote thousand times now, this is the number one culprit of unnecessary debt. It can be the latest smartphones, computers or cars if you don’t have 10x more than the price of the item then you can’t afford it. As long as the purchase can generate cash then it might be good debt if not then it’s just a bad debt.
Most of us have wishes and wants that are bigger than our income. You might have heard the old saying, “You can have almost anything you want; you just can’t afford everything you want.” Many people get into debt and stay in debt because they tend to buy what they want when they want.
Not even millionaires can afford to buy everything they want. If you want something, don’t buy it unless you have the money. If you can be satisfied with less than you would ideally want, even temporarily, you can use the money you save to pay down your debt. By the time your debt is paid off, you’ll probably have adjusted to your new priorities, and you can use the money that you are saving to put towards other financial priorities.
4. It’s too late for me to Save
My friend, saving is for everyone its for the young and old. It’s not just for ourselves but for our family and loved ones saving for the future is the best love letter we can give them.
Most Filipinos avoid Life insurance or retirement insurance when in fact it is a shield for future expenses especially for breadwinners, if something happens to us what will happen to our loved ones? Our little kids or our elderly parent have no source of income.
Life insurance is actually for the poor, when rich people passed away they leave money for their family’s future when poor people passed away they leave debt to their family, it’s sad to say this but this is true. This is where Life insurance can help us: Guide to Life Insurance.
No matter your stage of life, it’s important to have savings: Whether it’s for a special purchase, a college education, your first home, retirement, or an emergency fund. Everyone has the ability to save., you can start small and save only 1,000 pesos a week or month. Over time, your deposits will add up. Even small amounts of savings can help you in the future
5. My kids/relative will take care of me.
Why do we have to burden our kids while we can take action now and take care of ourselves for our future? Kids are not investments let us let them live their own lives. Would it be a great feeling that when our children are creating their own family we are the ones who are actually helping and taking care of them instead of the other way around?
A typical conversation between siblings:
“Ikaw naman mag alaga kay Tatay/Nanay laki ng gastos namin dito”, ” Ikaw naman bumili ng gamot nila wala kami pera ngayon” What if we change the conversation to:
“Sa amin naman si Tatay/Nanay miss ko na sila” , “Lagi naman kayo ang kasama nila mag libot, nila kami naman”.
Such a belief has been around for centuries. As far back as the 3rd century AD, the Roman Empire had filial responsibility laws mandating the mutual obligations of support and maintenance between children and parents. It’s always great to help our parents if they need money, but let us stop the cycle there, let us be a blessing to our children and relatives.
6. I did not finish school so I cannot be rich
We all know the story of Mark Zuckerberg (Facebook), Henry Ford (Ford), Bill Gates (Microsoft) these guys don’t have college degrees. What about our local heroes? You’ll be surprised by this, Henry Sy (SM), Lucio Tan (PAL), Danding Cojuangco (San Miguel), Injap Sia II (Mang Inasal), and John Gokongwei(JG Summit) they all started without a college degree. It’s no secret here, that all of their success and riches are results of years of hard work and perseverance.
“If you are born poor It’s not Your mistake, but If you die poor, It’s your mistake.”
At these days and age, when you can learn almost anything. Online learning can turn you into an instant expert all you have to do is apply what you’ve learned and put it to heart, next step? teach it to other people. Education doesn’t end in school, let us all be an eternal student, learn a new thing a day and you learned 365 new things in a year.
Don’t let others shake you out of your dreams, as Henry Ford quote: “A poor man is not the one without a cent. A poor man is the one without a dream”.
I had the same money beliefs growing up in a middle-class family and I had learned everything the hard way. These are common Pinoy money beliefs, that is why we want to teach more and more Filipinos about Financial Management. Let us change our mindset and overcome these beliefs so we can pass better money beliefs to our children and the next generation of Filipinos.
Stockbytes PH, June 8, 2020
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