How Pride Ruins Your Financial Plans

Filipinos have weird definition of saving money. Hence, we have a difficult time actually doing it. In a recent survey by the BSP (Bangko Sentral ng Pilipinas), about 8 of 10 heads of Filipino households do not have any bank accounts, and most do not have enough cash saved up for emergencies.

According to survey, about 4 of 10 households do not have any cash on hand to be used in case of emergency, while 6 of 10 households have very little cash to spare. Average cash on hand of Filipino families that may be used for emergencies stand at only P1,681.

It is understandable that perhaps one of the many reasons as to why most Filipinos don’t save money is because of the lack of funds. Yet, a recent report this week shows that credit card receivables up 9.9% to P132.2B.

“More and more consumers are using their credit cards to finance the purchase of goods and services as receivables of banks almost posted a double-digit growth last year, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

Data from the central bank showed that credit card receivables of universal, commercial, and thrift banks increased by 9.93 percent to P132.24 billion last year from P120.3 billion in 2010.

The BSP said universal and commercial banks accounted for 99.6 percent of the total credit card receivables last year while thrift banks got a marginal share of 0.4 percent.”

I get it, people don’t have money that’s why they keep on borrowing and by relying to the blood-sucking credit-card companies.

Actually, I don’t really get it. I don’t understand why people keep spending money on things they don’t actually need and eventually sacrifice their needs in favor of the things they want. Spending the money they are yet to earn.

I don’t understand why people just can’t develop frugality and humility.

Yes, there’s only one explanation for all of these – PRIDE.

Filipinos love fiestas. For some people, no matter how difficult their financial situation is, they would do all they can just to celebrate it. Even if it means having the need to borrow money.

I know of a family who lives a ‘one-day-millionaire’ life where as soon as they get their hands on their salaries, they would come rushing to the department stores and splurge on jeans, shoes and eat like there’s no tomorrow.

Most people wanted to get away from their current situation and hoping that maybe a day of comfort would help them forget the reality of their condition. That maybe for a day when they get to live like royalty, it will somehow become forever.

Trying to escape the reality of our financial situation doesn’t actually solve the problem. Trying to get credit cards just to pay off the other debts do not exactly solve the real problem. It just piles up.