One of the downsides of the long Philippine holiday season is the Filipino culture of overspending and overuse of credit cards to splurge during the Christmas celebration. After the holidays, the usual Filipinos are heavily in debts, and it would take too long a time to normalize their financial conditions.
Most of our countrymen do not know the fundamentals of financial literacy. They tend to spend much more than they have earned and they just approach the Christmas season with a ‘’bahala na’’ attitude. Thus, they end up financially bankcrupt after the holidays.
First of all, most Filipinos do not know how to handle money. Let us take as example, the returning migrant workers. The OFWs who come home for Christmas come home with a lot of money. They bring in so many ‘ pasalubongs’ consisting of expensive jewelries for the wife, the latest phone models and other gadgets for the children, branded clothing and shoes for the brothers and sisters, and a bundle of cash for Mama and Papa, including special packages for the in-laws. Then, they throw lavish parties and drinking sprees for the neighbors and friends. They spend freely on foods and drinks, and entertainment. They tend to show off and show to one and all that they have money and they are ready to paint the town red.
Secondly, people from the provinces who are working in Metro Manila have the same tendency. When they come home for the holidays, they also spoil their family and relatives by spending much, much beyond their means. They would beg, borrow and even go on usurious loans to finance this cultural fixations to spend like there is no tomorrow. This phenomenon is not entirely the fault of the over-spenders. There is a strong pressure from the families themselves and from friends and relatives. There is no culture of thinking beyond the holidays. The minds of the Filipinos are focused on Christmas and New Year.
Thirdly, Christmas in the Philippines, by tradition, is a time to buy, buy, buy, then give, give, give. There is no culture of planning and proactively determining budgets as control mechanisms for the tendency to overspend. By culture also, Christmas is a time to eat, eat, eat, then drink, drink, drink. All these entail expenses. That is why the consumers in the Philippines have their heyday and the big malls, department stores, restaurants and bars always make a killing during this season. People spend away all their earnings and savings and even splurge on things using money that is still to be earned.
What the Filipinos need today and all the time is education on the fundamentals of financial literacy. This was my legacy to the OFWs when, for nine years in my career, I served as labor attache in Malaysia, Kuwait and Taiwan. Perhaps, all mayors, governors and even barangay chairmen should teach the people how to manage their resources well. My formula is simple: spend only half of your net income, save a quarter and invest the other quarter. Never spend money before you earn them. Burn your credit cards, and keep only one for emergency. Be wise always.