5 Questions you should answer about your money

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By: MJ Gonzales | Executive Chronicles

Commonly, there are only few things employees think about their salary. How much? When to receive? Where to spend it?  Though these questions are important, but they’re also the basic. There are more terms you should know to handle your money wisely.

Usually, how you allocate your salary?  For frugal moms this is the basic task, but not for professionals who get good amount money once or twice a month.  The problem with no budget or allocation of money is you are also no idea your real monthly income, expenses, and net worth.  Apart from those, you will not know how much you need to save for your emergency, retirement, and other funds.  Who knows you end up paying only debts each month because of overspending.

Can you keep money for emergencies?  Don’t think that because you are young and a regular employee, you are immune to financial woes.   Creating emergency fund is a must for everyone especially for busy folks like you. Why? You’re prone to accidents and health risks by just doing your duties at work.

What’s your credit score? Whether you’re not planning to have any kind of loan soon, you must check your credit history.

“A credit history is an account of how you’ve used your credit over the years that shows your responsibility in repaying your debts. Banks use this history to determine whether you’ll be likely to make payments on time or not,” iMoney explanation. The financial site also reported that in the Philippines; BPI, Metrobank, BDO, Citibank, and HSBC are all tied with TransUnion East Asia, a reputable credit reporting agency.

Do you have debts?  In connection to credit score and for your wealth creation too, settling your debt will make your money go further.

How much you pay for your tax? Sure your income tax depend on the amount of money you earn. However, you can lower the tax you pay by knowing if you’re qualified for tax exemptions. According to MoneySense’s report, single individuals can avail Php25,000 to Php 50,000  exemption.

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“The law allows P50,000 exemption for single individuals, head of the family and even married individual. The law also allows additional exemption of P25,000 for each child or dependent (maximum of four), which by definition include senior citizens. So if your parents or even grandparents are dependent on you, then you may even add those to your exemptions,” Eric Chan, RFP® shared on MoneySense.