Plan Your Next Trip to the Philippines without Breaking Your Budget
Smart Financial Tactics for Filipino Balikbayans (Travel Tip #07)
When there was a family emergency in the Philippines, I used my credit card to book my flight. Money that was supposed to pay for something else was also used during that trip. It destroyed my budget. In this post, I will share with you how I financially prepared for my next unexpected (or planned) trips to the Philippines.
Envelope Method
When I was newly married, I budgeted our meager accounts using physical envelopes. Today, I still use an envelope method but use different online banking accounts instead. I discovered the beauty of NOT seeing the bulk of your funds in just one online bank. I have a main checking account that receives all my income. The moment I get a paycheck (when I was still employed) or figured out my profit (now that I work for myself), I immediately transfer to other online banks a certain percentage of my net. I decide, in advance, what percentage I will transfer to the following accounts:
giving account (which includes money I send to relatives in the Philippines)
savings or future essentials (extra for housing bills, utilities, repairs, etc.)
investment (after paying off all debt except for mortgage)
travel or fun account
I disciplined myself to transfer money regularly even if I only earn a few hundreds. My pre-determined percentage can be as little as 3% and goes up to only 10% of my net. Thus, a travel account that only started with a few dollars, became more than enough when I needed to suddenly travel. And if a relative suddenly needed help, I have a budget for that (or I can sincerely say I do not have any budget right now). Some of the online banks I use are Capital One, Ally Bank, and Schwab. I’m sure there are more. Just find a bank that do not require a minimum deposit and have minimal fees.
Live Beneath Your Means but Have Fun
The envelope method will actually force you to live with 70% or less of your income after you paid taxes and other government fees. That means you have to discipline yourself to spend less than you earn. However, it doesn’t mean you have to deny yourself. I pamper myself with salon visits and purchases using my fun account, which is different from my Philippine travel account. Doing so helps me make bigger and more meaningful fun purchases.
Smart Spending Tips
Saving is just one part of budgeting. You have to spend wisely too. Review the previous posts in this travel series about:
We will restart the Philippine Money Series next week. It will be about the challenges Filipinos abroad face when they need to open a peso banking account.