Many OFWs, myself included, have little or no strong financial literacy background before flying overseas to work. Financial events were not too often during my first few years here in Dubai. Many of us thought that working abroad would make us rich quickly, yet we don’t know what specific actions would make that a reality.
Well, I had my shares of financial blunders which I’m not really proud of, but happy to have learned a lot of lessons from them which enabled me to make better financial decisions moving on. Here are 6 specific money mistakes I made in the past:
1. Early learning books set
We paid AED17,000 for 2 years for 50+ hardbound books set for kids that were barely used. We were convinced by the empathetic sales talk. We were told that the set has all the books children will need, so we won’t have to look elsewhere in the future. As we discover, the books lack fun elements to properly connect to their young readers. Aya loves to read other books – those cheaper ones that have a higher value.
Lesson: Don’t be impulsive, and don’t easily give in to sales talk pressure. Give yourself time to think thoroughly even though the promises are very good. Ask yourself multiple times if what you’re buying is really a need.
2. My Video Talk networking
Talk about wanting to get rich quick… Sometime in 2008, I was convinced that My Video Talk is the future of video conferencing. I bought the basic package that costs around AED1,500 trusting I can also recruit more people who’ll also believe in the product.A couple of years later, we saw the evolution of Skype, Facebook, WhatsApp and Viber video calls which totally killed the product. This is my personal classic example of not getting updated about what’s coming up ahead.
Lesson: Research before spending. From then on, I have never been convinced of any “get rich quick” schemes.
3. Pasalubong for the entire barangay
On our very first ‘balikbayan’ trip since working abroad, we brought pasalubong (items from Dubai) for almost everybody we know back home – family, distant relatives, friends, classmates, neighbors. We brought chocolates, perfumes, shoes, shirts, grocery items, key chains, etc. Boy, that was too much.
Lesson: You don’t have to. Trust me. Stick to the real reason WHY you are traveling home and the itchiness of spending too much on pasalubong will go away. Again, don’t give in to pressure. It’s better to spend your money on family activities and experiences than on expensive items.
4. Lavish kid’s birthday parties
We celebrated our daughter’s first 4 birthdays with huge parties. Yeah, we had lots of fun. They were fab parties. But later we realized the party was not really for our daughter (who’s a toddler) but for us. At her very young mind, she wouldn’t remember all that.The following year, we made it simple. We invited close friends at home. The next year, we didn’t have a party at all, just a treat to her favorite restaurant and play area and a gift she’s been asking for ages.
Lesson: Though we may have the budget, it’s not worth it. Okay, the first birthday is okay if we really have the means. If we’re thinking to give the best present, we’d rather put the money in an investment for the kids.
5. Fancy cake every month
We spent a minimum of AED150 for a fancy decorated cake to celebrate the first monthly milestones of our baby.
Lesson: You can celebrate without a costly cake. With our second child, the wife happily chose to bake her own simple home-made ref cake or sometimes kutsinta, and it’s equally fun.
6. Bought a used car without proper inspection
As a new driver, I had fears I might not be able to drive really well and might just damage the car in the beginning – so I bought a used car – a Mazda 3 for AED14,000 only. Well, you guessed it right, I spent much more on repairs and maintenance – about AED20,000+. Apparently, I learned from the service center that the car was used for rental services for a long time. After a year, the car is dead. Good that someone still bought it – for scrap for a measly AED4,000.
Lesson: Buy new – you won’t have a headache. Arrange a monthly installment that fits your cash flow. If you really had to buy used ones, be extra diligent. Don’t just take it to Tasjeel for basic inspection. Pay for a comprehensive inspection and they will go deeper into checking the car history.
And ask around. Take advice from the experts among your circle.
We all commit big and small money mistakes, to each his own. Pick up the lessons, live with wisdom, and do better the next time.
