The Philippine Peso is weakening.
The currency’s purchasing power is diminishing as inflation hits 6.9 percent in September from 3.4 percent in January, according to a Philippine Star report. What this soaring rate means is that you’re now paying more for any consumer product, from alcoholic beverages and food to vehicles and home equipment, that used to fit your budget.
There are two fundamental ways to cope with today’s expensive cost of living: spend less or earn more income.
How do you spend less?
Buy Smart
You’ll notice that your P1,000 in the wet market or the grocery store is barely enough to fill up an entire bag. That same amount used to give you, for example, over 12 different items now only leaves you with eight. You’re left with two options here: spend less than what you normally do or buy cheaper items.
You’ll need some form of expense management to survive the rising cost of everything, whether it’s for household needs or your utility bills.
Spending less sounds doable if you’re willing to let go of some items, such as:
- Credit card spending
- Weekend trips
- Movie night at the mall
- Dining out on Sundays
But if you’re not inclined to give up the small luxuries (and sometimes, you need them more because they relieve the stress from work or at home), there is another way. Buy the right products at the right time.
Try the following:
Find a cheaper alternative
Every pricey product will have its pocket-friendly equivalent; sure, you might not get the same quality, but in general, you’re only paying for the privilege of the brand not because it has “better attributes” than its counterpart.
Try Out-of-Season Purchases
Swimsuit shopping in the summer is going to be expensive; the same goes for Christmas decor during the holidays. These are seasons you can prepare for by buying before they come up, or even when they’re done. End-of-season shopping means you can pay less than the typical price because everyone else has done their shopping and retailers are eager to unload their excess inventory.
Do an inventory before buying
Declutter your home before making any purchase; this includes your refrigerator and cupboards. When maximizing your budget, you don’t want to buy something you already have or replace an item that’s still working well.
Buy in bulk what you frequently use
Toilet paper, dishwashing soap, cooking oil, these are just some of the items you’re likely to use more frequently than other products. Instead of buying them every single time you head to the grocery store, keep them in stock and save money in the process. You can also buy items that tend to go up in price more frequently than other items, like rice. But make sure to store perishable goods well in airtight containers.
Rank items according to their necessity
A list will help organize your purchases. For example, before getting a new wardrobe, you could list the following:
- Missing pieces – key pieces that complete any outfit
- Replacement pieces – basic pieces that are worn out from repeated use (e.g., socks, underwear, etc.) and so need replenishment
- Fantastic additions – trendy items you could do without
When you prioritize items instead of listing them, you’ll get what you need on a budget you require.
All these strategies need to be addressed with your family. Saving money is not your responsibility alone; you’ll achieve better results when you bring everyone in on your ideas. Call for a family discussion and talk honestly about your finances. Explain to the kids why some belt-tightening is necessary. Of course, don’t go over their heads and launch into an introduction of the inflation rate and market laws. Talk about concerns that are appropriate for their age; this should also be a good time to teach your kids about the value of money, specifically about earning good money.
Earn More Income
In some cases, all your money-saving strategies just aren’t enough because you don’t have enough money. Whether you have a family or live alone and support your immediate family, getting extra income will augment your expenses. Even with a 9 to 5 job, you can still make money off of another job, sideline, or as Pinoys like to call it “raket.”
And many are doing it.
A 2017 GoDaddy survey of 1,500 workers in Singapore, Hong Kong, and the Philippines shares that 77 percent of Pinoys have a sideline. You just have to get organized, maintain your energy, and choose the right second income-generating endeavor:
Freelance Professional Services
Barring any agreement with your company, you can offer your professional skills to others. If you’re a CPA, for instance, you can offer tax accounting to entrepreneurs, or if you’re a web designer, you can do cost-effective websites for small businesses.
Home-based Business
Of the 77 percent of Pinoys who have a sideline, 55 percent are pursuing their passion. So if you enjoy baking, vlogging, or computer refurbishing, you can turn that love into a money-making hobby. Do it well enough, and that sideline might just be your ticket to financial freedom, without your 9 to 5 hustle.
Buy and Sell Trade
It’s easier to sell goods these days, what with online portals and Pinoys warming up to the idea of online shopping. Even better, you can work with couriers to arrange a convenient way for your customers to pay for and receive the items your selling.
LBC, for example, has a program that allows for door-to-door deliveries and cash-on-delivery options. And instead of the usual meet up, you can designate branches as drop off and pick up points for your customers. You can then collect those payments at certain branches.
And if you have the resources and the patience:
- Turn your empty lot into a parking lot – if your neighborhood’s turning into a commercial hotspot, do your community a favor and add to your income by converting unused space into a parking lot.
- Place your second home or apartment on the rental market – you can put a For Rent sign on the property itself, or go digital by becoming an Airbnb host. You’ll have access to millions of potential renters, and you’ll have control over house rules.
- Invest in mutual funds – mutual funds are professionally managed bonds, stocks, and various investment products. It’s a low-capital investment and provides diversity with your investments, but growing your money this way will take time.
When you need to earn extra income, don’t forget to take care of yourself. You need to practice some type of fitness routine, to eat right (and at the right times), and to ditch the bad habits (if you smoke or drink excessively, now’s the time to quit or do it in moderation). The investments you make for your financial future are not going to matter if you end up getting sick. You won’t be able to enjoy the results of your hard work and the money you made might just go toward treatments and doctors.
Whether it’s spending smart or earning more money, draft a plan and talk it over with the family. Do it right the moment you start, and your peso might just increase in purchasing power.