There’s no better time to start making resolutions than at the beginning of a new year. While getting in shape and spending more time with loved ones are always popular goals, there are a few financial resolutions that Filipinos should make, too.
Whether you spent more on ‘budol’ items on Shopee and Lazada last year or had pledged to pay all your credit card debts, then carry on. It’s not yet too late to build good habits when it comes to your finances this year.
Unfortunately, 2021 was relatively a rough year, and keep in mind that 2022 is already welcoming us with a sharp increase of COVID-19 cases and rising prices of goods and commodities.
Amidst the uncertainties and struggling economy, here are financial resolutions that Filipinos should make to build a more financially secure year.
Invest in yourself and upgrade your skills
If you are in the F&B, aviation, tourism, and retail industries, you and your colleagues have encountered the word retrenchment. The pandemic has affected these industries, and if you are unemployed, the best thing to do right now is to invest in yourself and learn new skills.
Well-paying jobs require skills training, specialized knowledge, and certifications. Stop thinking that your degree is enough to land you a lucrative position since the demand for technical skills has increased drastically. Plan B or a fall-back is better than having no plan at all.
Make time to learn new skills and take advantage of the free courses from TESDA and upskill at your own pace since you can do it online. You may also subscribe to paid courses on Coursera if you want certifications or enroll in an online university. You might not get hired immediately, but the time you spend upskilling can make an impact on your career in the long run.
Join the 52-week ‘Ipon Challenge’ and start saving
The ‘Ipon Challenge’ is making rounds in social media every new year, which is an effective way to manage your finances. The challenge is pretty straightforward. Set aside savings every week for the next 52 weeks according to your available income.
For example, if you earn P500 per day from Monday to Friday, then aim to save at least P200 per day, which will accumulate to P1,000 in just one week. So, you have P52,000 in your account by the end of the year. It’s best to set aside money that’s realistic on your side. You can start with a small amount and gradually increase it to save more.
It’s a good habit to help you save for your emergency fund or rainy day cash before financial emergencies happen. If joining the 52-week Ipon challenge is too difficult for you, then don’t worry since there are other effective ways to build your emergency fund, too.
For starters, try automating your savings by opening an online account or setting up a direct transfer from your bank account to yours every payday so savings won’t be scattered over time.
Check all your recurring expenses and other financial commitments
Just like bills and additional costs will keep popping up every month, so is your need for financing to cover them. Therefore, it’s essential to take a closer look at all the money you send out every month. Check your previous subscriptions and plans and find out if there’s a need to downgrade or cancel an account.
If you regularly commute, for example, and spend P3,000 for transportation a month but can only earn P5,000/month, then that’s already P2,000 short to sustain your lifestyle. This isn’t sustainable since you’ll eventually run out of money before the end of the month, which could lead to financial problems down the road.
If limiting expenses seems impossible due to how expensive living in Manila is or simply because you enjoy buying new things from time to time, then try rethinking your spending habits one by one. This way, you can reduce unnecessary expenses, which could help build your emergency fund simultaneously.
Review your investment portfolios
It’s good to review your investment portfolios regularly. If you still have plans to invest in the stock market, now is the best time to start with small amounts before eventually growing your money after three to five years. However, do not go overboard with investing especially if you don’t know what you’re doing, since this could lead you to lose more than earning.
If it takes too much effort or concentration, set up an automatic withdrawal from your bank account into a low-risk investment fund like an online money market account so investing won’t be overwhelming and stressful at the same time.
Low-risk investments are highly liquid and accessible, making them ideal for money that needs to be readily available for expenses or emergencies. However, if you’re an aggressive investor, you may explore other instruments such as cryptocurrencies, which are highly volatile and riskier than traditional ones like stocks and bonds.
Earn extra money from a side hustle
If you feel like your salary doesn’t stretch far enough for your financial goals and dreams, then you might want to find a side hustle on top of your regular 9-5 job. Find something you enjoy doing and learn about it more so you can easily offer the service or product in the market.
Not only will you gain more knowledge about the field that interests you but also open up opportunities for extra income since there are countless people looking for services online. For example, if you’re good at using social media marketing strategies to promote businesses, then apply this skill in promoting your own business through blogging or vlogging or maybe even opening an FB shop for all things handmade.
Some skills don’t require much effort, but it pays off if you have a spare time of at least three hours after work and start small. After that, proceed to more challenging tasks as you get better and more experienced.
With a little time and effort, you can make significant changes to your finances for 2022. The New Year is a time to make resolutions for your future. Whether you want to save money, invest more wisely, or earn extra income on the side, there are plenty of options available.
If the thought of doing all this by yourself makes you feel overwhelmed, you can always start small and stay accountable with friends who also share the same mindset and financial goals this year.
Here are some of our previous blog posts that can help you get started:
- The MoneySmart Guide to Creating a Pandemic-Proof Financial Plan – MoneySmart Philippines
- 4 Clever Ways On How To Save Money For Millennials
- Budgeting 101: The Best Apps to Track Your Expenses – MoneySmart Philippines
- 10 Things to Do if You’ve Been Retrenched During COVID-19 Pandemic – MoneySmart Philippines
So, what are your New Year’s resolutions? Let us know in the comments below.