Why we need to talk about money
To the uninitiated, more often than not, conversations about budgeting and investing are met with dread. Other times, just plain hesitancy. While we were taught to “save up” during our formative years, once we start earning, society made it easy to get sucked into a lifestyle larger than our paychecks.
If there’s anything this pandemic has taught us, it’s that corporate jobs and long-standing businesses are not as stable as we thought.
Many are beginning to realize the value of good financial health. Propelled by the startling lack of personal finance literature catered to our country, two women decided to use content creation as a tool to help Filipinos get comfortable and intimate with their finances.
It’s often a trap. Once people start discovering investing, they immediately look at high-risk investments. My advice for people my age is just to increase your income-generating capabilities through learning new skills.
Young STAR talked to Nicole Alba, a third-year student from the University of the Philippines, and Ready 2 Adult PH’s Charm de Leon, a Cebu-based architect turned entrepreneur, to share how they keep their finances in order with the right mindset.
YOUNG STAR: What motivated you to learn about personal finance?
NICOLE ALBA: I was always scared of adulting. Leading up to my high school graduation, I started searching on how to make money online. I stumbled upon resources like investing. Then it just clicked. A lot of times, people only think about personal finance once it’s “real” adulting, but I wanted to get a headstart already.
CHARM DE LEON: It was two years after I started a business. When I started earning, lifestyle inflation was real. I noticed that my bank balance didn’t really grow as much. I was earning a decent amount, but I wasn’t saving. I started researching personal finance and found out that, yeah, I was a victim of lifestyle inflation. Realizing that, I became more aware, more intentional.
For college students and young professionals, what’s a good first step to start their financial journey?
NICOLE: It’s often a trap that once people start discovering investing, they immediately try to look at high-risk investments. But my advice for people my age is just to increase your income-generating capabilities through learning new skills. When we’re starting, we don’t have much cash or capital to start with. An advantage that we do have is we have a lot of time.
CHARM: Mindset is first. It’s realizing why you need to get a hold of your finances better. Yung mindset kasi ng YOLO, it was very prominent a few years ago. A lot of people think, “I’ll just spend, travel, and eat whatever I want. I never know when I’ll die.” But what if I live until I’m 80? What happens then, and you’re already retired, and you don’t have savings?
If we’re gonna go technical, I’d say track your expenses first. That’s really the number one step. Tracking your finances is underrated. People want to jump into investing agad because it’s growing your money, it’s so romanticized. For me, basics talaga muna.
How do you think we can refrain from overspending on impulse purchases?
NICOLE: This is not to say I don’t impulsively buy. Sometimes, advertising still gets to me. But the way I control it is really valuing my money in a sense that I’m equating it to time. So, if you’re going to work for P150 per hour, essentially every P150 is one hour of your life. You’re exchanging one hour of your life for that thing, and if that’s worth it to you, then go buy it. By having that mindset, you think about it more intentionally.
What can you say to people who have made financial mistakes in the past and feel discouraged from starting again?
CHARM: Start with small improvements and small steps rather than just completely ignoring it. A lot of people tend to shy away from managing their finances altogether just because they’re scared to learn that they’re bad at handling money.
I really believe in starting out small. I’d suggest for people to stay with their day job and start a side hustle, and try to grow it to a point where it might be able to replace your salary.
What do you think should be considered before investing any money?
NICOLE: When you notice your spending habits are problematic and you want to start taking responsibility, the very first step is asking yourself: why do you want to fix your personal finance habits? Then, after that, looking at your baseline. How much money do you have at the moment? Do you have debts? Just identifying your why, then your starting point.
What’s a good investment vehicle?
CHARM: My personal favorite is the stock market. I know it’s really intimidating, but for me it’s one of the easiest and most powerful forms of investment once you get to know it. There’s a conservative and aggressive way of investing in the stock market, so there’s something for everyone there.
Any advice for people who want to start a business for another source of income?
CHARM: I really believe in starting out small. I’d suggest for people to stay with their day job and start a side hustle, and try to grow it to a point where it might be able to replace your salary. I like to do calculated risks; that’s why I discourage people from going all-in. You can start by obsessively researching about the business you want to get into before putting any money to it. That’s a healthy obsession.
How does your community approach new lessons on money management?
NICOLE: In this age, where it’s always older people and men (investing), I think it’s refreshing to see someone like me, who’s a lot younger, be so excited to talk about these things. My community has been responding very well. I’d like to think I’m very engaged with them. More than making videos and sharing what I know, I like that my community has been an opportunity for like-minded people to get together and learn from each other.
CHARM: Generally, very positive. I get so happy when they reach out to me (saying) that I’ve made an impact in their lives. It’s one of the things that drives me to keep on making this type of content. Generally, Filipinos are so eager to learn about it. It’s just that we don’t have much avenue to learn these things, especially in school. But I’m really happy that people are responding well. It just shows how hungry Filipinos are for this type of content.
Ultimately, what do you want your viewers to take away from your channel?
NICOLE: At the very least, the thing I want to impart is that people have more control in their lives than they acknowledge. I know it varies from person to person because some are more privileged, but I really do believe we have the power and capability to steer our lives in the way we want to. It’s not strictly about money. Just be more intentional with how you live your life, the way you view things, and encounter people.
CHARM: I want them to know that personal finance isn’t as intimidating as they think. It’s not as hard as what our emotions make it out to be. I always say personal finance isn’t about numbers or math, it’s really about psychology. Why are you afraid to confront your finances? Why do you impulse-eat and stress-buy? It’s not bad if it’s intentional. Just take it one step at a time and acknowledge if there’s a problem and that you need help. Don’t overthink. Just start learning these things.
* * *
Visit Nicole Alba‘s and Ready2Adult PH‘s YouTube channels to learn more!