Suze Orman: PH money culture must change
MANILA, Philippines - If Filipinos want to save and become financially sustainable in the future, they should start changing their culture of spending beyond their means, world-renowned personal finance guru Suze Orman said.
"Don't spend money you don't have to impress people you don't know or even like," she said in a media briefing in Makati City on Thursday, May 16.
The finance icon is back in the Philippines for the second time to give advice on how to manage personal finances, something which heavy-spending Filipinos need.
The personal finance guru lauded the Filipinos' love for their family and the innate nature of making everyone at home and comfortable but said that they should also be true to themselves in terms of spending money.
She cited, as an example, the kind of extravagance that Filipinos put in terms of celebrating events. Filipinos try to accommodate everyone to the point of spending money beyond their means, which in turn puts them in debt.
"I understand the Philippine culture. But if you continue to do something that you don't have the money to do then you end up poor, you end up being dependent on others," she said.
The goal of money, Orman said, is not for people to be slaves of it but to make them feel safe and secure, not only in the present, but especially in the future.
Learning to say no
Another notable thing about Filipinos according to Orman is their inability to say no, especially to family members.
In a country kept afloat by consumer spending and remittances, Filipinos need to learn how to better manage their finances, according to Orman.
In 2012, Bangko Sentral ng Pilipinas (BSP) said personal remittances from Overseas Filipino Workers (OFWs) reached a record high $23.8 billion.
Consumer spending has been on an upward trend yet only 2 out of 10 Filipino families have bank accounts - an alarming figure, said the personal finance expert.
Orman narrated the generic story of how most OFWs tend to send all their money to their families in the Philippines while they suffer in poverty in the foreign country they are working in.
Instances when relatives tend to ask a lot of demands to things not really necessary in everyday life as well as OFWs being bound to the duty of bringing home a lot of souvenirs and throwing a grand party everytime they come home.
This, she said, makes family members of OFWs heavily dependent on the remittances they send without actually trying to find work and stretch their muscles to earn money to help.
"Here is the truth. I understand the Philippine culture, but it needs to be rethought. It is not to disgrace the culture. You are not turning your back on your culture, but you should not turn back on the truth of yourself and your situation. Live within your means," Orman said.
"When your relatives ask you money for clothes or vacation expenses, learn how to say no. Give them money for their needs but not luxuries. It is not hurting them because you denied what they wanted. You are actually helping them to become better managers of their finances."
Teaching people how to say no to these things, according to the personal finance guru, is her goal in visiting the Philippines.
"I just want to be clear. I don't want to come to the Philippines to change your culture. I don't want to come to the Philippines to change your culture and change the love you have with your families and with each other. I want to come here and give a voice to those who don't have the voice, to people who tell me what they wish to tell their families but don't have the courage to do so," she said.
Orman is a New York Times best-selling author 9 times over and is considered one of Forbes 100 most powerful women in the world in 2010. - Rappler.com