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Grown-up Guide

Emergency Funds: Building Your Finances’ Immune System

Emergency Funds: Building Your Finances’ Immune System

Saving, spending, budgeting—part iyan ng pagiging financially educated. Ibig sabihin nito, financially educated ka pala! Huwag kang magulat–you’ve had to budget and save for those subscriptions and online shopping, after all. Pero mas marami pang mga paraan para maging money-savvy ka at para rin hindi ka magulat kapag nag-check ka ng iyong bank account.

Ngayon ang best time to learn kung paano maging mas financially secure. Medyo nakaka-intimidate pakinggan, right? But when you’re earning your own money, you will thank your younger self.

So how do you start your own emergency fund and beef up your financial immune system? Well, you can start with…

1. Recording your daily expenses

Masakit, right? Pero kung may summary ka ng daily expenses mo, makikita mo kung saan napupunta ang pera mo. From necessities like transportation to extra expenses kagaya ng milk tea or new sneakers, you’ll get a clearer picture of how much you spend and how much you can save. Kung nakaka-cringe ang total amount, it’s time for you to adjust.

Using your phone or notebook, try to record each expense you make, so you’re more aware of your spending habits. This would be the first step in beefing up your finances’ immune system; it’s important to take stock of what could be compromising your finances, so you can recognize it and “destroy” it before it attacks your savings.

2. Having a plan

Set a goal. Pwedeng simple lang, like saving 10% of your weekly allowance, and increasing it over time to meet your year-end savings goal. Kung medyo mahirap gawin iyan, tingnan mo muna kung saan napupunta ang pera mo. Halimbawa, ang paborito mong kape na binibili mo araw-araw. Is this something you can cut back? Kung yes ka diyan, hindi lang ang katawan mo ang magpapasalamat sa iyo, pati na rin ang wallet mo!

You could also dream big, like saving up for your college tuition or for further studies. Magkano aabutin ito? What’s it going to take to reach your goal?

After that, write down all the ways you earn money—bilang estudyante, malamang allowance ito, pero pwede ka ring ma-inspire to find new sources of income. Katulad ng pagbenta ng mga damit mong hindi mo na nagagamit. How’s that for resourcefulness?

3. Paying yourself first

Another important step para maging mas financially secure ka ay ang pag-change ng iyong mindset. If you think of “savings” as funds that you’re not allowed to spend, then setting aside money will feel more like a punishment.

Here’s a better way to approach it—instead of looking at your savings as leftover money from spending, ibawas mo na agad ang savings mo sa income o allowance mo para magkaroon ka ng budget para sa paggastos mo.

Ganito siya para mas madaling matandaan:

     Allowance/Income – savings = money for expenses

Imbes na:

     Allowance/Income – expenses = money for savings

Think of it this way: ang pag-iipon ay pag-iinvest sa sarili mo. Sa emergency fund mo rin mapupunta ang savings mo.

Changing your mindset also applies to purchases—especially impulse buying! Tuwing may bibilhin ka, ask yourself kung kailangan mo ba talaga ’to o kung makatutulong ba ito sa productivity mo. If it’s just something you want, it can definitely wait.

When you think of it this way, you’re building up immunity from damages incurred by reckless spending. This conscious habit could basically be the “antibodies” to your impulse buying’s “toxins”!

Ang isang savings account ay makatutulong din sa pag-track ng progress mo. For example, sa BPI Save Up Account, pwede kang magsimulang mag-ipon for as low as ₱250! It also includes free life and accident insurance worth five times your average account balance, up to ₱2 million. Plus, you can monitor and access it through the BPI Mobile App or BPI Online. Kaya naman, diba?

4. Making investments

Investing your money sounds complicated and “grown-up,” but understanding it as early as now will definitely be an advantage.

When you invest your money, para ka lang ding nagsasaka. Dahil nagtanim ka ng buto, tutubo ito, at may aanihin ka. It’s the same principle with investments—you put your money in a place that will possibly make it grow over time, and eventually provide you with income.

But remember, you also have to be ready to encounter losses. Make sure that the money you use to invest is money you can afford to lose. It has to be a reserve, extra money set aside from your daily budget and savings. Think of them as the vitamins that help keep your finances’ immune system robust and strong.

There are different types of investments. Para sa mga conservative investors, ang fixed income investment, gaya ng Time Deposits, ang mas maingat na paraan para mag-invest. Nagbibigay ito ng fixed rate of income over time, which is an excellent way to passively earn some money. Hindi man malaki ang kita, mababa naman ang risk na mawala o malugi ang iyong pera. Kaya ang tawag dito, “low-risk, low-reward.”

Para sa mga malalakas ang loob, merong variable income investments, katulad ng sa stock market, business, or real estate. The places you invest money in are highly unpredictable. That’s because they change values every day based on people’s perceptions. Investing in the stock market is an adrenaline rush for sure!

There will be some days when you’ll lose money, but if you get lucky, you’ll win big on other days. Kaya ang tawag dito ay “high-risk, high-reward.”

You can also research about mutual funds and unit investment trust funds (UITFs) that are offered by legitimate financial institutions. Merong iba’t-ibang klaseng funds na pwede mong pagpilian depende sa iyong risk appetite and investment personality.

5. Protecting yourself from scams

Boosting your financial immune system means being well-informed about scams—the more you know about these harmful financial “microbes,” the more likely you’ll be able to identify them and reject them before it penetrates the defenses you’ve set up. Sabi nga nila, if it seems too good to be true, it probably is!

Anything that promises high returns but low risk likely has something in the fine print that you should double check. Kung may mga kaibigan kang financially savvy, tanungin mo sila—not only will their input be invaluable, may matututunan ka pang bago!

Guarding your money from scammers, probably.

Protecting yourself also means safeguarding your online banking accounts. If you use public Wi-Fi for making financial transactions, someone else may be able to access your personal information, then use it to steal your identity and scam you.

Acquaint yourself with your bank’s procedures. Kung may natanggap ka na suspicious text message galing sa kanila, make sure to verify this by calling your bank’s hotline on their official website!

 

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