Understand The Difference Between Assets and Liabilities

A Good Man Leaves an Inheritance to His Children's Children

As good parents we ought to try our very best to leave inheritance not just to our children but to our children's children. But, for that to materialised in the future, the first step I guess is to educate ourselves to become financially savvy as early as possible. One thing I learned so far is that time is really valuable if not the key for it to become reality. The early we are financially educated and is acting upon it the longer the time frame our savings will work for itself. Perhaps, you don't have an idea or confused of what I'm saying right now but, once you understand how compounding money works you'll appreciate more what is TIME in relation to savings. Have you known someone who just spend 1 year worth of their salary for one grand extravagant feast? Yet, not bothered about the expenses incurred because as he or she say, that 1 year worth of salary can still be earned next year. Well, I guess it's okay if:

(1) We have accumulated enough savings already, and that 1 year is just a pinch of our savings 

(2) We are young and our parents are rich and money is not really an issue 

(3) Our time in this world is counted, I mean what for is the used of savings if by few years we are gone anyway unless of course we're saving for someone else 

(4) Though not rich, but still young and still have few years to waste for foolishness. 

But, if we are just trying to make an impression and is not one of the mentioned above, who are we fooling? I guess ourselves. Being financially educated, we're supposed to realised that at least small portion of that 1 year worth of extravagant feast could have started growing or already have grown by now. 

What's my point? If we have learned to become financially savvy after throwing the feast at a very late stage of our life, we'll have no enough time frame for our savings to grow, this time around, time is against us no matter how we try. So, we end up depending on our luck (lotto and other alike) or we depends on our children's and perhaps their children's too. 

How does this relate to the subject? If we intend as parents to leave inheritance to our children's children, we better be financially educated and ACT upon it while time is still in favour of us. Otherwise, no matter how we try later on, like what I said, we'll either depend on luck (lotto) or perhaps the government (pension) or on our children itself or ALL. 

Read How to Manage Cashflow: Click here
Read The Importance of Emergency Fund: Click here

"Bahala na si Batman" Attitude in Personal Finance

If I'm not mistaken "Bahala Na" approach is one of the Filipino cultural trait which is situationally based, that is to say, its meaning can best be understood in a situational setting. In this regard, I would like to pin point the "Bahala Na" attitude of us Pinoys towards financial handling given the benefit of a doubt that, we actually have sufficient enough to cover our priorities only that we mismanage it.

It's quite funny sometime that even the famous superhero is being involve with this expression. Like the "Bahala Na si Batman", perhaps, it is a funny expression for us to comfort ourselves when we are caught in a compromising situation where it seems like no immediate solution. Or, is it simply a sign that we are lacking in planning in which we tend to anyhow do or decide on something without thinking of the consequences that may arise later? In relation to personal finance, this type of attitude could be problematic not just towards ourselves but also to our friends, neighbours and relatives, in which, sometimes we are not aware as we tend to don't care as long as we solve our own first. Like say for instance, just after our payday instead of doing budgeting to plan our expenses, we spend something that is really not within our priority affecting the rest of daily expenses and, we know that it will, so at that moment, we tend to just say "Bahala Na si Batman" implying that somehow somebody or comically Batman will take care of the rest. Though, somehow it could ease the feeling of worries nevertheless still is an illusion and, I guess we are aware of that. So, what we really mean I think when we say this expression is that, we are expecting someone, our friends, neighbors or relatives perhaps to lend us their help monetarily should we run out of money already.

The bottom line I guess is that to prevent this kind of compromising situation and to avoid disturbing someone. Why not learn to plan our expenses via effective budgeting, it may seem hard at first but like any other instances in life, it's always not easy in the beginning, only by constantly doing it will make it slowly easier until it become a habit and, if it become one, we might even feel like our day is lacking without it being done the same as any other habit would feel. 

Click to read: The first Step: Manage your Cashflow

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