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Thursday, November 14, 2013

How to explain personal finance to your family?

Honestly, there's no great way to tell your family about money struggles.  With Filipinos, most of us depend on a sole breadwinner.  We are also in the "Sandwich Generation" where parents depend on you financially and work for your own family as well.

It's hard.  It's also a sensitive topic.  Not everyone wants to listen about personal finance.  I have tried but failed sometimes to explain in-depth the importance of  budgeting and personal finance.  And it hurts my ego.  It is also stressful.

From what I've read and watched, we can try these strategies that subtly pushes personal finance into the topic: 

I tried to convince my parents to invest for a long time.  It wasn't until I invested myself and told them, particularly my mom, about it that they got convinced and invest herself.  Of course, there's still a long way to go.  And since they started pretty late, their finances need to catch up.  So whenever I find something that would help them with their retirement fund, I tell my mom immediately.

They see how you handle your yourself and your money.  As a matter of fact, my mom thinks I always have money saved up, because she sees I get to buy my needs and wants, without compromising my financial obligations.  She doesn't know I'm struggling myself.  I still need to work on the impulse buy. 

This is really hard.  You cannot just ignore your family when they need you the most.  But apparently, you need to give them "tough love" when money is concern.  You are not helping them when you just give them money.

I am guilty of this.  I cannot just turn my back when I see family crying because of financial difficulties.  I don't say yes, but I can't say no either.

From what I've read, in order to help them, it's much better to discuss how they got into the financial rut in the first place.  Formulate a solution.  You can apply for a loan.  But if I were to ask, I wouldn't  recommend it.  If I can avoid getting in debt, I will.  Assess the situation, formulate a solution, and manage the solution.  Hmmm....

You can't change them, but you can try, with the help of God, to change yourself.  Your perspective will change the more you read about His Word and other financial articles and books.

We all struggle but that shouldn't change your relationship with your family.  When you see your imperfections and how God has corrected it, you can take their imperfections lightly and help them.

I guess at the end of the day, they can either accept your suggestions or brush them off.  You can't really convince others to think the same way as you.  But you can try, with a bit of "force" (LOL!) to let them see the big picture.

Ask them:
  • When you get old, where do you want to go?  What do you want to buy?
  • When you get sick, how are you going to pay for it if you're not working?
  • Do you have any goals?  Travel goals?  Life goals?  Bucket list?  Wishful thinkings?

I just noticed that when there are goals involved, people are likely to pay attention and be open to suggestions, especially when they feel they can actually achieve them.  Who wouldn't want that?

Just assure them that when they have questions, you are there to have or find an answer.

Photos taken from RFP Philippines website  

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