By Rowen Lyn Guacena
Editors Note: DNX contributor Rowen Lyn Guacena is an enterpreneur, freelance writer, and mother of two.
“The key to saving is knowing your average monthly income, saving upfront a minimum of 20% and not spending beyond your capacity to pay.”
These were the words of my Tita Nene. The truth is, she has given me a lot of financial advice throughout the years because when I was in my early 20’s I was living from paycheck to paycheck. I didn’t really pay attention because somehow, I made it work. I was young and had no commitments or responsibilities. All I had was bliss.
Everything changed though after giving birth to my first child. Suddenly, I had additional expenses like baby formula, diapers, vitamins, the list goes on so obviously my paycheck was no longer enough. I found myself borrowing money and taking loans, which was something I was completely against.
I thought the solution was as simple as finding work with better pay because naturally, more pay means more money. Right? Wrong! I did find a better paying job though. Sadly, it wasn’t the solution to my financial troubles. I eventually realized that although my pay increased, so did my extra unnecessary expenses. In the end, I dug a grave I buried myself in.
Then my brilliant Tita Nene told me to list down all my monthly expenses and run it against my monthly income. That simple exercise triggered a habit and next thing I knew I was budgeting. I used to have to write it down in a notebook and then it moved to Google Sheets. My budgeting kept improving through the years.
Budgeting didn’t only help me become more financially stable though. It also helped me make life changing decisions, like knowing I was ready to buy a house. 18 months later, I knew I was ready to buy the house next to it. I was able to plan out vacations and travel. Birthday celebrations were well prepared for. However, the best takeaway I appreciate the most is peace of mind and security because I no longer fear worst case scenarios.
