CAGAYAN DE ORO CITY (PIA)–To promote understanding of financial wellness, the Bangko Sentral ng Pilipinas (BSP) conducted a learning session on financial literacy during the closing program of the National Statistics Month (NSM) celebration in Northern Mindanao, Oct. 27.
The session aims to equip participating employees from member agencies of the Regional Statistics Committee and students on financial planning in terms of budgeting, savings, securing investments, managing debts, and awareness of financial frauds and investment scams.
“Financial planning is for financial health. Kung kailangan natin alagaan ang ating physical health para hindi tayo magkasakit, kailangan din nating alagaan ang ating financial health. Because if you plan your finances wisely, alam mo kung saan pupunta yung pera mo at alam mo kung magkano ang gagastusin mo. So, there will be no overspending,” explained lawyer Clarence Joseph Zosa of BSP Economic and Financial Learning Office.
(Financial planning is for financial health. If we need to take care of our physical health so we don’t get sick, we also need to take care of our financial health. Because if you plan your finances wisely, you know where your money will go, and how much you will spend. So, there will be no overspending.)
“The first component of financial planning is budgeting, which involves balancing earnings and spending. Budgeting allows individuals to control their money and avoid unnecessary spending,” Zosa said.
He also reminded participants to save for unexpected life events such as sickness, natural disasters, accidents, epidemics, and death.
The effective way to save, he said, is to follow the simple formula of income minus savings equals expenses, to prioritize needs over wants, and to live below one’s means.
Zosa further provided saving options such as banks, savings and credit cooperatives, self-help groups, savings and loans associations, and non-financial assets. He added that saving cash in banks has advantages like savings safety and security, liquidity, and interest earnings.
“The best time to budget and save is now,” he emphasized.
In terms of borrowing, he told the participants to manage their debt wisely to avoid a debt trap.
According to him, some strategies in paying off debts are debt stacking or paying loans by prioritizing first those with higher interest, debt snowballing or prioritizing paying loans with the smallest amount or outstanding balance, and loan restructuring.
Zosa also clarified that debt cannot cause imprisonment unless it involves deceit or fraud.
The BSP lawyer further discussed the basic concept of investments, the types of investment instruments, and the risks associated with each investment instrument.
He also explained some common investment scams and frauds, such as Ponzi and pyramid schemes, phishing, vishing, spoofing, and skimming, and warned everyone to protect themselves from these scams. (APB/PIA-10)
Lawyer Clarence Joseph Zosa of Bangko Sentral ng Pilipinas discusses the importance of financial literacy. He specifically delves into the basics of financial planning, budgeting, saving, investing, and avoiding debt traps as well as financial frauds and scams during the closing ceremony of the 34th National Statistic Month celebration in Northern Mindanao. (DCC/PIA-10)
