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How to Know If You Have the Right Money Habits?

29 April 2023
How to Know If You Have the Right Money Habits

Money habits can make or break your financial future. But how do you know if you have the right ones? Perhaps, you save religiously but then splurge on luxury items every once in a while. Or, you never miss a bill payment for your house and lot in the Philippines, but you have no idea where your money goes each month. It can be challenging to evaluate your financial behavior and determine if your personal finance is on the right track.

 

Fortunately, there are a few key indicators that can help you determine if you have the right money habits. So, you can get a clear picture of whether or not you're making wise money choices. 

 

 

3 Most Common Pinoy Money Habits

First and foremost, there are three (3) most common money habits of many Filipinos. And, these money habits can have a negative impact on your financial well-being. If you have been practicing any of these spending habits then you’ll definitely have financial issues in the future. 

 

 

Not saving for retirement

A significant number of Filipinos do not prioritize saving for a retirement account. In fact, many Filipinos tend to rely on their children or family for financial support during retirement. As a result, it puts a strain on family relationships and compromises their financial independence.

 

If you have this kind of habit, this can also lead you to financial difficulties once you get old, especially when unexpected expenses arise.

 

 

Failing to budget

Many Filipinos do not have a clear understanding of where their money goes each month. They often fail to create a budget or stick to it, which can result in overspending, debt, and missed financial opportunities.

 

If you don’t know how to make a budget on how to spend money of yours, it can be challenging to save money, pay off debts, or invest in the future.

 

 

Living beyond one's means

Many Filipinos also tend to prioritize short-term “Wants and Needs” over long-term financial goals, such as making savings accounts or investing. This habit involves spending money more than what you earn or having high levels of debt.

 

If you have this habit, it can also lead you to financial difficulties, such as having to borrow money or resorting to high-interest loans to pay for daily expenses.

 

 

Small Money Habits to Pick Up this 2023

Practicing small money habits can have a big impact on your financial health. You can achieve financial security and build wealth over time if you know how to control or manage your spending habit. Here are five (5) tips you can pick up this 2023.

 

 

Start with a savings account.

If you don't have a savings account yet, open one now. Set up automatic transfers from your checking account to your savings account. This will help you save money regularly and build an emergency fund. You can also consider opening an investment account to grow your money faster.

 

 

Track your spending habits.

Review your bank account and credit card and student loan statements regularly to keep track of your spending habits. Identify areas where you can cut back on unnecessary spending and avoid wasting money. Allocate funds for your living expenses, bills, debt repayment plan, and of course, your financial goals.

 

 

Make a debt repayment plan.

If you have high-interest debt, such as credit card debt or student loans, make a plan to pay them off as soon as possible. Allocate a portion of your income towards debt repayment each month. As such, this will help you build good money habits and improve your financial health.

 

 

Prioritize financial goals.

Determine your financial priorities and set achievable financial goals. Whether it's saving for a down payment on an affordable house and lot property, building an emergency fund, or investing for retirement, make a plan to reach your goals. It would be much better if you consult with a financial planner.

 

 

Build good financial habits.

Adopt better money habits, such as regularly reviewing your bank accounts, paying bills on time, and saving money regularly. This will help you build financial security, achieve financial freedom, and build wealth over time.

 

 

Consequences of Having Bad Money Habits

On the other hand, having bad money habits can have significant negative consequences on your financial well-being, personal life, and future opportunities. You can experience the following:

 

 

Debt

Poor money habits, such as overspending and living beyond your means, can lead to high levels of debt. This can be difficult to manage and can negatively impact your credit score.

 

 

Financial stress

Financial stress is a common result of bad money habits. If you're constantly worried about how to pay bills or make ends meet, it can lead to anxiety, depression, and other health problems.

 

 

Lack of financial security

Bad money habits can prevent you from building a safety net for unexpected expenses, such as medical bills or job loss. Without an emergency fund, you may have to rely on high-interest loans or credit cards to cover these expenses.

 

 

Limited financial opportunities

Bad money habits can limit your ability to achieve financial goals, such as buying an affordable house and lot for sale or investing for retirement. This can also limit your financial freedom and prevent you from living the life you want.

 

 

Strained relationships

Money issues can also cause strain in relationships, especially if one partner has bad money habits. This can lead to arguments, misunderstandings, and even separation. What’s worse, your children will suffer the most, losing their self-esteem and being distracted.



While it is true that there is no magic formula for securing your future, it is worth noting to practice good money habits. Not only you can provide better financial support to your loved ones, but you are also stress-free if you’re a wise spender. 

 

This is the reason why Lumina Homes ensure that our selection of house and lot properties are guaranteed value for the money. All our residential communities nationwide are equipped with complete amenities that suit your lifestyle and needs. Plus, the payment options are also flexible and affordable. Rest assured you’ll not be drowning in debt once you become a Lumina homeowner. 

 

So, make a home reservation now or reach out to our accredited sellers and agents near you.

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