After passing the board exams in May 2005, I immediately started working in June in one of the leading Telcos in the Philippines – I was just 22 back then and after 2 years I started working overseas and landed a pretty much decent job in Abu Dhabi. Even though I am an accountant by profession – it did not guarantee wise money decisions in my young professional life and this makes me wish to go back in time and give myself some piece of advise.
Honestly – I do have loads of regrets when it comes to my financial habits and decisions in the past and up to this day I am facing consequences of my poor judgment. But that doesn’t stop me to continue to aspire and strive even more to pursue my way into financial freedom. I have decided to consider those failures as meaningful experiences and turned them into learning that I can use as a reference going forward. In view of same – all the more that I desire to somehow help people to not commit the same mistakes I made by trying to spread awareness on matters like this. On that note let me share to you few of the financial advises I wish I had been given (especially when I was younger and single) that “could have” spared me from all those gaffes.
- Live cheaply, if you can (within or below your means) – when you are young and just started earning – it is so tempting to show off and buy stuff that you will regret buying afterwards. Latest craze, must-have items, fashionable stuffs, up-to-date gadgets, travelling, shopping and many more. I am not saying it is bad – what I’m trying to point here is do not splurge on these things –do not blow your paychecks and credit cards just to live a lifestyle you can’t afford. And if you are lucky enough to afford it – learn to set limits and develop self control, know when to slow down and when to stop. It took me a while before I became matured enough to stop and I was punished for it for a long time before I was able to got out of credit card debts.
- Start saving for your retirement as early as possible – start small but SAVE regularly – If there is a time space warp – I would definitely tell my 20-something self to allot and set a specific saving goals each month and make sure I actually meet them. I’ve been in the workforce for more than 10 years now and it pains my heart to look back at what I could have saved from that time till now if I have started early. When you are young and earning – more often than not, you are just looking at present situation – retirement never or rarely comes to mind and we tend to set that aside for later. Now that I am a wife and a mother, how nice it would have been if I have created a safety net early and have financial stability and would not need to work 40+ hours per week to catch up. So to the young ones, Push! Push! Push (yes I said it thrice for emphasis) yourself to start saving a portion of your earnings on a regular basis and if you do – don’t tap it every time there is a SALE!
- You have savings? Well good! – but don’t stop there, learn to invest wisely – I should have educated myself more on the different investments I can do with my savings – though I do have some investments now, it would have been even better if I started way back – so that I have maximized the full potential of the power of compounding as much as possible. Invest, but do it smartly – if it is too good to be true ,chances are it is. Stay away from quick rich schemes and practice due diligence before investing your hard earned money.
- Insurance is not a scary thing- I think a huge number of people share the same misconception about insurances – I for one, have always thought it is not necessary, it is an expense and just a piece of paper and I don’t even want to talk about it because its all about morbidity and death. People, especially Filipinos are pretty much unaware or sometimes misinformed about what insurances are and how important it is to have one. Personally, I never considered having an insurance until I was pregnant and even at that time all I was thinking was possible death (yeah how morbid of me). Good thing, its not too late for my case, after getting my first insurance plan – I have started reading about it and educating myself and also with the help of some friends in the Insurance industry, I was able to grasp it fully. More than the fact that yes, Insurance is a means of protection from financial loss – there are different insurance products that comes with different riders and also provides savings and investment options that could serve as life benefit for the insured person as well. It is wise to learn about this from an expert and even better if you know the agent personally so he/she can explain in full detail all the costs and benefits of acquiring one.
So there you have it – these are some of the financial advises I wish I knew, for the young ones reading this – it is up to you if you will heed to it or ignore it. You can be writing your own version of this article after 10 years and will realize later in your life how it could have impacted your life if you did or did not listen to this. For the not so young ones like me – it is not too late, today is the day to take that decision to start doing better when it comes to your finances. If you did some financial mistakes like I did – don’t punish yourself too long and dwell on it for the rest of your life, at the same time do not repeat the same mistakes – take it to heart – learn from it and move on. Take it as a challenge, to make better choices and start discovering your way to the path of financial freedom. As the old saying goes – IT IS BETTER LATE THAN NEVER – you can still do something to make your financial life in order.