( This is part of Take Charge of Your Money, a partnership between INQUIRER.net and Citibank to help readers handle their personal finances well.)
Q: The company I work for is in the export business, and since last year, we’ve been experiencing tough times. Some workers were laid off, especially those in the production department. I'm in the administration office, and we were just told that there will be no salary increases this year, and our benefits will remain the same. With prices of goods going up, I was counting on the salary adjustment plus higher food and transportation subsidies. How can I better cope? – Gil
A: The global financial crisis has affected a lot of businesses, and the export industry is one of them. It is thus no surprise that your employer is having a hard time.
First things first: Look at the bright side—you still have a job. Other people have been laid off, even those who worked for your employer. You can of course look for another job, one that will pay more and will offer job security. However, the job market is very competitive and it may take a while for you to find a job where you will fit.
So here are some steps you can do in order to make the most of your current situation:
Rework your budget. Start by listing down how much income you will expect per month from all sources (your present job, as well as any interest income from bank accounts or investments). Then jot down all your projected fixed expenses such as rent or mortgage, utility bills, insurance premiums, tuition fees, and the like. Include a new item—Savings—and allot 10 percent of your income for it. Don't stop saving every month as this will see you through unforeseen emergencies that may happen in the future. Then see how much is left for your variable expenses such as food, transportation and recreation.
Talk to your family. Be honest and tell them that your salary will not increase this year and that you all need to do your share to help the family cope with a limited budget. Assure the children, especially the young ones, that needs will be prioritized. Sometimes children think the worst right away, and may worry needlessly.
Live according to your budget—your means. Try to spend only within the amount left for your variable needs. This may take some adjusting on both you and your family's part. For instance, limit eating out to maybe once a month, and at a cheaper restaurant, or even try to skip eating out altogether and enjoy home-cooked meals every day instead.
Find ways to up the excitement factor. Even when on a budget, you can have wonderful meals at home. Consider having a weekly theme night—some good themes include 'Beach' wherein you serve grilled fish and clam soup or 'American' and serve fried chicken and corn on the cob. Be creative so the family will see they can still have a good time even on a budget.
Ask for longer better terms for payables. For tuition fees, for example, talk to the school and ask if you can switch payment mode from quarterly to monthly if that will be easier for you on the pocket. If you have a bank loan, set an appointment with your creditor and see if the terms can be changed to help you lower your monthly payables.
Scrutinize your daily spending and see where you can cut down. Find a route to work that will be less expensive, or look for a carpool you can join. If you need to have a cup of coffee every day, instead of buying from the coffee shop, fast-food outlet or the vendo machine, bring your own 3-in-1 coffee sachet. Bring a brown bag lunch to work rather than buying at the company canteen. If you're smoking, this is a good time to cut down on your cigarette habit—for both health and financial reasons.
Look for bargains. Grocery items may be cheaper at warehouse clubs or at certain supermarkets—find out where you can get the best deal. If you need to have your car repaired, ask quotations from more than two car repair shops.
Trade or sell unused things you own. An old lamp just gathering dust in a corner or a comic book collection you have outgrown may be worth precious pesos which can be used for your family's needs at this time.
Apply for a low-interest loan. Should money really be tight and you need to pay for needs, shop around for a personal or salary loan that will not cost you an arm and a leg in terms of interest. If you have built up a good credit history over the years, you won't have a problem applying for a loan. The Social Security System and your bank would be good places to start.
The future need not look bleak with no salary increase in the horizon. Things will get better as you do your part.
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