Identifying financial alarm bells

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  • Friday, 16 Jun 2017

I CAME across “The Avocado Toast Index: How many breakfasts to buy a house?” on recently.

The article takes a jibe at the lives of some millennials who would rather waste their money on an Instagram-mable breakfast than make sensible investments like buying a house.

Though I am not a millennial nor do I splurge on fancy toasts or overpriced lattes, I had my fair share of financial woes during my late 20s.

My divorce fees were putting a toll on my finances and because of that, I lapsed payment in my hire purchase loan and nearly got my car taken from me when my first-born and I were alone inside the car.

That incident shook me and I vowed never to put myself and especially my daughter in that embarrassing situation again.

I am now quite particular about paying my bills on time. I pay my credit cards dues in full and I have a budget drawn and monitored monthly.

I only use my credit card for payments of which I have money to pay back. The only reason why I use my credit card is so I can collect points that can be converted to mile points for travel.

I keep all receipts because I like to know where my money is going and how I can trim costs further. Now that I don’t have a full-time helper, I am more involved in the upkeep of the pantry and household products. I used to find it odd that I would spend so much on detergent and other cleaning products.

Now that I clean, wash and cook, I realise I save so much more – probably because I use these household products in the right amount?

Even with food, I portion my food produce accordingly so I just take it out for one meal and not have to defrost the whole chicken, for instance.

I am a firm believer in segregating waste, especially kitchen waste, so I feel the pinch when I see good food go in the bin.

I think it is very important to have a savings plan and manage your finances. Some people are great at managing their finances, while some struggle.

How do you know if you need to change the way you handle your finances? Here are nine signs to help you according to Miriam Caldwell, a personal finance adviser.

1. Relying on your credit cards.

Running into the red may happen occasionally but if you find yourself relying on your cards each month, it’s time to identify areas where you are overspending.

2. Late payments.

If you keep forgetting, maybe try to schedule your payments to come out automatically or pay all of your bills all at once at the beginning of the month (I do this and it gives me the reality of how little I have left to splurge on). If you don’t have the money to pay the bills on time, a budget and some careful planning can help you pay all of the bills.

3. Sleepless nights worried about money issues.

When you have a budget that you can stick to and an emergency fund saved up, you can rest easier.

4. No communication with your spouse.

It can be frustrating to merge two different styles of managing your money and many couples struggle with this for several years into their marriage. My parents were the complete opposite when it came to handling finances. Mum was extremely frugal and careful, while my dad usually depleted his resources due to his generosity – trying to assist the kampung folks who almost never paid back their loans. Though religion teaches one to be charitable, there needs to be a time when one needs to tow the line.

5. You don’t have a budget.

If you do not set a budget, it is too easy to lie to yourself about your finances.

6. Overwhelmed by amount of debt.

In Malaysia, you can seek the help of the credit counselling and debt management agency or commonly known as Agensi Kaunseling dan Pengurusan Kredit (AKPK), set up by Bank Negara Malaysia to help individuals take control of their financial situation (

7. Stuck in a financial rut. Once you know what to do, it is a lot easier to motivate yourself to actually start doing it.

8. You run out of money too early in the month.

My assistant was constantly asking for an advance to tide her over until the end of the month when I finally decided enough is enough. I sat down with her and poured through her bills and told her that she needed to trim down on unnecessary stuff such as makeup and new clothes.

9. Every bump in the road is a catastrophe.

When you are struggling financially, even a trip to the doctor or paying for a car repair can feel like the world is coming to an end. Again, it all boils down to setting and sticking to a realistic budget and to start saving for an emergency fund.

My financial goal is to be free of debts, to have saved enough for my retirement and for all my children to at least complete their tertiary education.

It’s still a long way coming, but setting that budget and sticking to it is the most important step in getting there.

The writer dreams of retiring in her home state of Sabah and living in a sustainable community growing her own produce, and rearing her own farm animals. Catch her vlogs via her YouTube Channel: Daphne Iking

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