Walking the walk
Yesterday, I showed you a personal graph of my assets and liabilities minus the actual figures of course. But I'm pretty sure you get the idea. I just included the part where I reorganized the figures so that it will account every single centavo in credit and debit. But if I had to stretch the graph farther to the left - way back several months - I'm sure you'd come to conclude that I'm a hopeless case. Seriously, the hobo on the street has a far more higher networth than I was then (that is to exclude any future earnings in the equation).
There's always a turning point. And like most turning points of this kind, it's ugly. Everything doesn't stop in realizing that everything is in mess and a plan to stick to my budget this time around. It involved a lot of cutting off some of my expenses to avoid defaulting on my debt which was constantly haunting me like forever.
So it was some kind of a clearance sale. Food budget 30% off! Entertainment 90% off! Come now, come all. Travel expenses 10% off. Buy one take one! Etcetera...etcetera.
The most depressing thing probably is when I cutback on my tricycle ride to my place after every FX ride from the office. That's more than a kilometer stretch from the main street. Considering I only saved a measly 6 pesos by taking a night walk everyday. That's Php120 a month. Php1440 a year. In some standards, that's a significant savings. But in so many ways, it's not worth it. It might be true that saving a little is still saving which can mean a lot in due time. But walking alone in a not so conducive neighborhood is pretty much depressing. It made me to think and rethink a lot of things. Most of them "not good for the health" kind. I think it lasted for about 2 months and a few months thereafter intermittently.
For some people it's one of those instances where you curl in a corner and shed tears of self-pity. But I can't. Mainly because part of what happened to me then was somewhat self-inflicted. And I don't tend to linger much on the self-pity part. Mainly because I'm equally terrible at showing self-pity even to myself.
So instead, I laid out the blueprints of my finances (and by association, my life, so to speak) in a table. Rolled my sleeves up. Studied every single lines and curves, every single entrances and exits. And draw fresh lines and curves if necessary. All this, while nursing a depression and a sense of disappointment.
Basically, I'm talking about assessing my situation for damage control. I stretch out the timeline from that point to the past and another one to the future. What I see then gave me a sense of hope. It was not just one but several lights at the end of the tunnel.
I'm talking in metaphors here but basically, I'm talking about starting a financial plan - which at first mainly involved a lot of debt reductions. If I said it helped me a lot is an understatement. What started out as a personal spreadsheet of my income and debts eventually became a habit. A favorite hobby if you may. It started out as a simple list but eventually evolve into a system of complicated formulas just falling short of what a simple money manager software is capable of (Currently I'm using Quicken instead of a spreadsheet).
What I have achieved now is a little result of that turning point a little more than a year ago. It's the proverbial sitting down for a moment and facing the problem squarely. I couldn't stress more on the importance of creating a plan. It makes you see the bigger picture but at the same time you see bits of the problem that needs some correcting. And it's through this bits you work your way out the same proverbial tunnel.
Now, probably the tricky part is to recognize where to cut back on expenses. I definitely realize now that by walking more than a kilometer a day doesn't even made a significant dent to my ballooning debt. Rather it may have significant negative impact on my health (walking in a polluted street is kinda not a good idea). Cutting on food is probably a good idea too but the general idea is not to compromise with the more important things like health or family.
The general idea is that walking to save on travel expenses may not be worth the effort. There may be some areas in the expenses column that may be more appropriate for cutting. At the same time, it's also best to think of other areas to add in the incomes column. Financial planning maybe a science in itself but at the same time an art that needs a significant amount of creativity.
Now, it's your turn to review your own blueprint.
There's always a turning point. And like most turning points of this kind, it's ugly. Everything doesn't stop in realizing that everything is in mess and a plan to stick to my budget this time around. It involved a lot of cutting off some of my expenses to avoid defaulting on my debt which was constantly haunting me like forever.
So it was some kind of a clearance sale. Food budget 30% off! Entertainment 90% off! Come now, come all. Travel expenses 10% off. Buy one take one! Etcetera...etcetera.
The most depressing thing probably is when I cutback on my tricycle ride to my place after every FX ride from the office. That's more than a kilometer stretch from the main street. Considering I only saved a measly 6 pesos by taking a night walk everyday. That's Php120 a month. Php1440 a year. In some standards, that's a significant savings. But in so many ways, it's not worth it. It might be true that saving a little is still saving which can mean a lot in due time. But walking alone in a not so conducive neighborhood is pretty much depressing. It made me to think and rethink a lot of things. Most of them "not good for the health" kind. I think it lasted for about 2 months and a few months thereafter intermittently.
For some people it's one of those instances where you curl in a corner and shed tears of self-pity. But I can't. Mainly because part of what happened to me then was somewhat self-inflicted. And I don't tend to linger much on the self-pity part. Mainly because I'm equally terrible at showing self-pity even to myself.So instead, I laid out the blueprints of my finances (and by association, my life, so to speak) in a table. Rolled my sleeves up. Studied every single lines and curves, every single entrances and exits. And draw fresh lines and curves if necessary. All this, while nursing a depression and a sense of disappointment.
Basically, I'm talking about assessing my situation for damage control. I stretch out the timeline from that point to the past and another one to the future. What I see then gave me a sense of hope. It was not just one but several lights at the end of the tunnel.
I'm talking in metaphors here but basically, I'm talking about starting a financial plan - which at first mainly involved a lot of debt reductions. If I said it helped me a lot is an understatement. What started out as a personal spreadsheet of my income and debts eventually became a habit. A favorite hobby if you may. It started out as a simple list but eventually evolve into a system of complicated formulas just falling short of what a simple money manager software is capable of (Currently I'm using Quicken instead of a spreadsheet).
What I have achieved now is a little result of that turning point a little more than a year ago. It's the proverbial sitting down for a moment and facing the problem squarely. I couldn't stress more on the importance of creating a plan. It makes you see the bigger picture but at the same time you see bits of the problem that needs some correcting. And it's through this bits you work your way out the same proverbial tunnel.
Now, probably the tricky part is to recognize where to cut back on expenses. I definitely realize now that by walking more than a kilometer a day doesn't even made a significant dent to my ballooning debt. Rather it may have significant negative impact on my health (walking in a polluted street is kinda not a good idea). Cutting on food is probably a good idea too but the general idea is not to compromise with the more important things like health or family.
The general idea is that walking to save on travel expenses may not be worth the effort. There may be some areas in the expenses column that may be more appropriate for cutting. At the same time, it's also best to think of other areas to add in the incomes column. Financial planning maybe a science in itself but at the same time an art that needs a significant amount of creativity.
Now, it's your turn to review your own blueprint.
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