CAGAYAN DE ORO CITY (PIA)–Just like exercising regularly and eating healthy foods, taking care of one’s financial health through proper monetary planning is one of the best ways to prepare for a successful future.
“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 [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 will know where your money will go and how much you will spend. So, there will be no overspending],” explained lawyer Clarence Joseph Zosa of the Bangko Sentral ng Pilipinas Economic and Financial Learning Office (BSP-EFLO).
To foster a broader understanding and appreciation of the importance of financial health, the BSP-EFLO conducted a learning session on financial literacy during the closing program of the National Statistics Month (NSM) celebration in Northern Mindanao on October 27.
The session was aimed at equipping 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.
Zosa explained that the first component of financial planning is budgeting, which is balancing earnings and spending. This, he said, is the way an individual controls his money and avoids unnecessary spending.
He reminded the participants to save to ensure that they are prepared for different life events and some unexpected events such as sickness, calamities, accidents, epidemics, and death, among others.
Zosa also advised that the most effective way to save is to follow the correct saving formula, which is ‘income minus savings equals expenses’, to prioritize needs over wants, and to simplify one’s lifestyle by living below one’s means.
He further provided saving options such as banks, savings and credit cooperatives, self-help groups, savings and loan associations, and non-financial assets. He added that saving in banks has advantages like savings’ safety and security, liquidity, and interest earnings.
“The best time to budget and save is now,” Zosa emphasized.
In terms of borrowing, he told the participants to manage their debt wisely to avoid a debt trap.
According to him, some of the strategies for paying off debts are: debt stacking, or paying loans by prioritizing first those with higher interest; debt snowballing, or paying loans with the smallest amount or outstanding balance; and loan restructuring.
The BSP lawyer also pointed out that debt cannot be a cause of imprisonment unless it involves deceit or fraud.
He further discussed the basic concept of investments, the types of investment instruments, and the risks associated with each investment instrument.
He likewise explained the nature of some notable investment scams and frauds, including the Ponzi and pyramid schemes, phishing, vishing, spoofing, and skimming, and cautioned everyone to protect themselves from these schemes. (APB/PIA-10)
Lawyer Clarence Joseph Zosa of the Bangko Sentral ng Pilipinas Economic and Financial Learning Office discussed the importance of financial literacy. He specifically delved 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 Statistics Month celebration in Northern Mindanao. (DCC/PIA-10)
