• 6 specific money mistakes I made in the past


    Many OFWs, myself included, have little or no strong financial literacy background before flying overseas to work. Financial events was not too often during my first few years away from home. Many of us thought working abroad would make us rich quickly, yet we don’t know what specific actions would make that a reality.

    Well, I had my shares of financial blunders which I’m not really proud of, but happy to have learned a lot of lessons from them which enabled me to make better financial decisions moving on.

    Here are 6 specific money mistakes I made in the past:

    1. Early learning books set  

    We paid AED17,000 for 2 years for 50+ hardbound books set for kids that were barely used. We were convinced by the empathetic sales talk. We were told that the set has all the books children will need, so we won't have to look elsewhere in the future. As we discover, the books lack fun elements to properly connect to its young reader.  Aya loves to read other books - cheaper cost, higher value. 

    Lesson: Don't be impulsive, and don't easily give in to sales talk pressure. Give yourself time to think thoroughly even though the promises are very good. Ask yourself multiple times if what you're buying is really a need.

    2. My Video Talk networking 

    Talk about wanting to get rich quick... Some time in 2008, I was convinced that My Video Talk is the future of video conferencing. I bought the basic package that costs around AED1,500 trusting I can also recruit more people who'll also believe in the product.

    Couple of years later, we saw the evolution of Skype, Facebook, WhatsApp and Viber video calls which totally killed the product. This is my personal classic example of not looking up at what's coming in the tech market.  

    Lesson: Research before spending. From then on, I have never been convinced of any "get rich quick" schemes. 

    3. Pasalubong for the entire barangay 

    On our very first 'balikbayan' trip since working abroad, we brought pasalubong (items from Dubai) for almost everybody we know back home - family, distant relatives, friends, classmates, neighbors. We brought chocolates, perfumes, shoes, shirts, grocery items, key chains, etc.  Boy, that was too much. 

    Lesson: You don't have to. Trust me. Stick to the real reason WHY you are traveling home and the itchiness of spending too much on pasalubong will go away. Again, don't give in to pressure. It's better to spend your money on family activities and experiences than on expensive items.

    4. Lavish kid's birthday parties

    We celebrated our daughter's first 3 birthdays with huge parties. Yeah we had lots of fun. They were fab parties. But later we realized the party was not really for our daughter (who's a toddler). At her very young mind, she wouldn't remember all that.

    The following year, we made it simple. We invited close friends at home. The next year, we didn't have party at all, just a treat to her favorite restaurant and her longtime wish list. 

    Lesson: Though we may have the budget, it's not worth it. If we're thinking to give the best present, we'd rather put the money in an investment for the kids.

    5. Fancy cake every month

    We spent minimum of AED150 for a fancy decorated cake to celebrate the first monthly milestones of our baby.

    Lesson: You can celebrate without a costly cake. With our second child, the wife happily chose to bake her own simple home-made cake and a lot more, and it's equally fun.

    6. Bought used car without proper inspection

    As a new driver, I had fears I might not be able to drive really well and might damage the car in the beginning - so I bought a used car - a Mazda 3 for AED14,000 only. Well, you guessed it right, I spent much more in repairs and maintenance. It reached AED20,000+. Apparently, I learned from the service center that the car was used for rental services for a long time. After a year, the car is dead. Lucky someone still bought it - for scrap.

    Lesson: Buy new - you won't have a headache. Arrange a monthly installment that fits your cash flow.  If you really had to buy used ones, be extra diligent. Don't just take it to Tasjeel for basic inspection. Pay for a comprehensive inspection and they will go deeper into checking the car.

    And ask around. Take advice from the experts among your circle.

    --

    We all commit big and small money mistakes, to each his own. Pick up the lessons and move on.
  • You might also like

    No comments:

    Post a Comment