I came from a middle-class family, and my parents started from the bottom. Growing up, my Mom always reminds me to be financially literate. At first, I didn’t bother to pay attention to her advice. As I grow older and responsibilities start to pile up, I appreciate every financial advice that Mom gave me.
- Get away and stay away from debt
Getting away from debt may seem hard in a world full of attractive products and services available through credit. Mom reminds me that getting my wants through credit and staying in debt can result in problems in the future. Why? As debt pile up, the more freedom I will lose.
- Freedom to purchase because I have debts to pay.
- Freedom to invest because I have debts to prioritize.
- Freedom to have financial security because I can’t save unless I am debt-free.
The worst part is I might have anxiety about owing money that needs to be settled amidst having a tight budget.
My Mom always tells me to prioritize my debt. Sacrifice a bit until I am out of it. Don’t be lured with companies that offer credit because if I compute the interest and months that I will pay the service or item that I bought using them, I will pay more rather than save and pay them in cash.
Getting and staying away from debt is hard. Once you are out of it, you will enjoy the freedom that you’ll have.
- Build an Emergency Fund
Emergency happens when we least expect. It may come in the form of an accident, unexpected sickness or medical issues, or a scenario where you need to buy an item/s because of unforeseen circumstances like the pandemic.
Having an emergency fund has a lot of benefits.
- It can cover me in the event of an unexpected financial blow.
- Help limit my chance of going into debt because I can always have emergency money to use.
- Provide peace of mind because I can still provide for my needs if I lose my job or there’s a sudden need for repairs at our home and on our car.
To start an emergency fund, My Mom advised me to open dedicated savings account for it. Then monthly, I allot an amount to cut on my budget for my emergency fund.
3. Invest in items and properties that can build your net worth over time.
Aside from staying away from debt and saving, My Mom always encouraged me to invest in items and properties that can help me build my net worth over time. These include real estate properties, pieces of jewelry, stocks and bonds.
In our current setup, the value of real estate properties doesn’t go down nor sleep. As the surroundings of the property develop, the higher the value of the former. Jewelry, on the other hand, is one of the least risky investments that I can get. As the value of our currencies shifts, gold, diamonds, and other precious metals and stones have remained stable over time.
As per stocks and bonds, I started funding it with a little amount of money and planning to increase the size of my investment later on. You can build massive wealth over time in investing stock and bonds but that requires leg work like research and finding the stocks and bonds that fit you.
4. Before buying think if you will use it or not
I am a compulsive buyer, that’s why my Mom always reminds me to buy things or get services that I will use.
To avoid impulse buying my Mom instructed me to do the following:
- Make a list of things that I need for a month and stick to buying the ones noted on the list.
- If I find an item or service that I want to get. I need to wait for a week and then check if I am still interested to buy it. If yes, then that’s the time I will purchase it.
- When shopping, I take with me the amount of cash I intended to spend.
- Avoid emotional buying.
5. Save… save… save
“Save for your future” I have heard this quote to my Mom a million times, didn’t bother about it before but when I become a Mom, I then understand why she kept on telling me that quote.
Saving money is honestly hard at first but rewarding. Saving made me financially independent by having a financial backup in case of unforeseen expenses or situations.
My savings can also provide for my daughter’s needs and wants and it is also for my comfortable retirement.
To make sure that I can save money, I set my saving goals annually. My goal can either be a certain percentage of my monthly income or an amount that I need to save yearly.
My Mom never fails to remind me of her financial tips and I appreciate that she does that. It made me keen about my finances and the way I spend my hard-earned money.