A few months ago, one of the managers at the workplace asked me to speak in front of her teams about the 3 simple steps to financial independence. This was after I had my speech about the same topic in one of our Toastmaster’s meeting. So all I really had to do was reuse my speech and add some more information because this second time, I am given a full 30-minute speech/lecture.
To give you a background, I decided to become active again
in Toastmaster’s for two reasons: 1) obviously, I want to improve more in
public speaking and 2) I want to reach more people in my advocacy for financial
freedom. Hence, when I was asked to speak to the teams of probably about 20
people, it was more of an indulgence rather than doing a favor. Haha.
Anyhow, on Monday, I did the speech/lecture. I think it went
well that I even surprised myself I was able to answer questions calmly and
collectively. Lol! I just know I need to do this more. It’s really a great way
to pay forward: to share everything I've learned in the past 9 months from the
generous people I barely know personally and to inspire ordinary people like me
that it is possible to be financially free because I myself is walking the
talk. So when I say that this journey to financial freedom is not easy, it’s
not hearsay. That it really is coming
from a personal experience. Note the
operative word “personal” which simply means personal finance is not a one size
fits all. I make my own. You make your own. But we can learn from each other.
:)
In my speech, I discussed only these 3 simple steps to start
on the journey:
- Pay yourself first.
Income-Savings=Expenses
Notes:
·
Save at least 20% of income.
·
Rent/mortgage <28% of income.
·
For food/groceries, $100/per person in the
household is more than enough.
- Pay your debts ASAP and
stop incurring any more debts.
If there are debts, one can choose
to put ½ Savings (see above) to the savings account and ½ Savings to paying
debts.
Notes:
·
Read about Debt Snowball.
·
Stop using your credit cards. Pay in Cash.
·
Read about budgeting (I’ll be giving a workshop
soon on this and I am very excited. Lol!)
·
Get extra income (sell stuff you don’t need,
sideline2x pag may time, negotiate with your boss)
·
Live below your means.
· Oh, you can leverage on debts. But you just have to do #3 and a couple of other steps first.
- Build up an emergency
fund.
This is just one of the “priority” Savings
categories. Other categories include retirement fund, educational fund, and
other financial goals.
Notes:
·
What counts as an emergency is a life and death
situation. Not because SM and Ayala are selling stuff on sale. Again, read
about budgeting.
·
Stop using your credit cards for emergency
stuff. You prepare for it in cash.
·
Emergency fund must at least be 3 month worth of
expenses. How much is it? You wouldn't know unless you have a budget in place.
Again, read about budgeting.
I think I gave a lot of other information that have been
very useful to me. I also shared with them the budgeting template I use with a
tab for reminders and links to resources. :) The discussion we had was so
amusing, really. I encouraged them to use the budget envelope system and
discussed how it works. I could see in some faces that they found it hard and
unbelievable. But I had to tell them it works and that I do it this way:
God
bless us all. :)
2 comments:
You are such an inspiration, Jin! The journey to financial freedom is indeed not easy. I can attest to that. That's why it takes hard work, discipline and diligence to attain financial freedom but it is absolutely rewarding. I really admire you and I'm so glad to have met you because I found another amazing soul to walk with me on this journey. God loves you!
Thank you, Fatima, for the kind words. I'm so glad to have met you, too, in this journey. God bless you! :)
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