Richard Poon, Maricar Reyes consider this budgeting method effective

by Justine Punzalan
Aug 22, 2019
No matter how much you are earning, Richard Poon and Maricar Reyes believe that the key to financial growth is proper budgeting through the "Envelope Method."
PHOTO/S: @maricarreyespoon on Instagram

As the cost of living increases and the prices of commodities continue to rise, budgeting your salary can be a daunting task.

Yet according to celebrity couple Richard Poon and Maricar Reyes, it is achievable even if you're earning minimum wage.

The key is to practice a budgeting method called "envelope system" and, at the same time, make a conscious effort to really stick to it.

On August 21, 2019, Richard and Maricar uploaded a video on their YouTube channel, addressing a problem of one of their followers.

According to the couple, the girl was caught in a huge amount of debt from loan apps that she downloaded on her mobile phone.

Loan apps, as Maricar described in another video, provide loans to users with minimum requirements and has fast approval.

The catch is, these apps can access all your contacts and send a text message to all of them when you haven't paid your debt yet.

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To help her and others who want to practice effective budgeting of expenses, Richard and Maricar recommended a technique called "envelope system."

RICHARD ON HOW THE "ENVELOPE SYSTEM" WORKS

Richard learned the "envelope system" from his friend and finance speaker, Chinkee Tan.

"Tinuro sa akin ni Chinkee iyan noong ako'y naglayas sa bahay. It's very, very helpful," he said.

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"Ito talaga yung totoong ginawa ko noong seven years akong may utang."

The "envelope system," as the name suggests, is a method of segregating your money into different envelopes for each type of expense.

Richard explained it like this: "Let's say PHP14,000 ang suweldo mo.

Kapag nakuha mo yung suweldo mo, kinsenas, maglagay ka na sa envelope."

Label your first envelope as "5% utang," meaning, you will put five percent of your salary into that envelope which you will use later to pay a portion of your loan. The percentage may vary according to how much you can allocate from your bimonthly salary.

He also added that it's best to pay your loan by installment instead of lump sum.

Doing so would be lighter on the pocket and gives you more control over spending your money.

"Kaya maraming hindi nakakabayad ng utang kasi gusto nila one time, big time. Mali yun," he said.

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"Ang turo sa amin ni Chinkee, ganito, sa envelope, maglagay ka ng percent... kung ano yung kaya.

"Halimbawa, hindi mo kaya ng malaki, e, di five percent. Kung kaya mong mas malaki, e, di seven percent."

For the next envelope, label it as "renta ng bahay."

He continued, "Kung kinsenas ang suweldo mo, yung kalahati ilagay mo na.

If you're like Richard who pays for his own tax, you can also create an envelope for "buwis."

He explained, "Mayroon rin akong tinatabing envelope for tax. Kapag nakuha mo yoong PHP14,000 mo or kinsenas mo, PHP7,000, ang mangyayari, five percent, i-times mo.

"Ilan yun? PHP350.

"Iyang PHP350, ilagay mo na iyan sa tax."

The couple said that you can make as many envelopes as needed.

The bottom line was knowing where your money should go so you won't be tempted to spend it.

As they say, "out of sight, out of mind," right?

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Maricar received this comment from a follower: "Mayroon naman akong budget, nakasulat naman."

She responded, "The reason why I think mas effective yung ilagay mo sa envelope yung pera kasi kapag nakasulat, madali siyang ibahin.

"Pero yung cash mo, ibubukod bukod mo siya, it's harder to spend the money kasi nakabukod na, e."

RICHARD ON PAYING DEBTS

Richard also reiterated that you will only reap the rewards of following a budgeting routine if and only if you have control over yourself.

He recounted the story of his friend who, together with his wife, used their savings to buy a second-hand TV rather than pay their loans.

"Mayroon sa aming minimum wage, sabi ko sige, envelope system tayo kahit maliit yung suweldo mo, ipo-prove ko sa iyo na puwede kang mag-save ng pera at magbayad ng utang. Mayroon siyang utang na PHP25,000.

"Bumukod siya ng 10 percent per month.

"Alam mo, after ilang buwan, yung utang niya, itong five percent [na envelope], nakabuo siya ng PHP2,500.

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"Sabi ko, ibayad mo na doon sa PHP25,000 mo para mabawasan na.

"Alam mo kung ano nangyari? Yung asawa niya, nakakita ng second-hand TV.

"Sabi niya, 'Mahal, bilhin na natin yung TV para mayroon tayo sa bahay.' Binili na niya.

"So makikita mo, yung envelope system really, really works... makakaipon ka talaga. Pero yung character pa rin ng tao ang pinaka-importante kasi kapag hindi ka nakapagpigil... maling-mali yun.

"Kasi yung inutangan mo ng PHP25,000, kailangan niya yung pera. 'Tapos yung PHP2,500, ginamit mo pang-sarili mong sarap. So makikita mo it's really character.

"Itong envelope system, kung hindi mo ito sineryoso, hindi rin siya effective."

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No matter how much you are earning, Richard Poon and Maricar Reyes believe that the key to financial growth is proper budgeting through the "Envelope Method."
PHOTO/S: @maricarreyespoon on Instagram
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