Filipino attitude towards money highlighted yet again

Recently, a renowned financial expert in the United States, Suze Orman, was in town for a series of talks about personal finance. Bank of the Philippine Islands (BPI) brought her over as part of their financial wellness advocacy. Naturally, one of the things she focused, and expressed concerns about, is the Filipino attitude towards money.

Ms. Orman has her own talk show on CNBC America on weekends, where she mostly answers inquiries from callers on whether they are able to finance things they want to buy. To read more about her, click on these two links.

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I have mixed views regarding the overseas Filipino worker (OFW). On one hand, there is nothing easy about having to leave your family for greener pastures abroad, in order to support those who are left behind in the motherland. That many have to leave behind what is considered a high-paying job here for a back-breaking job in unbearable conditions elsewhere, is simply sad. I, who have not yet experienced working abroad, cannot honestly say that I understand their pain. Nevertheless, I take my hat off to them. On the other hand, I wish they did not have to do what they do. That they are the result of a government who cannot provide jobs locally to support as many Filipinos as possible is simply appalling. That what becomes of their hard work and back-breaking labor, is squandered more often than not by their countrymen left here, is downright disgusting.

Before we go any further, one might ask: what is the link between OFW’s and the Filipino attitude to money? The answer is simple. The OFW remittances represent a significant portion of the money that keeps the Philippine economy afloat. In this article, Ms. Orman highlights a story of one of her employees who says that she is thinking about stopping the yearly visits to her hometown. Apparently, what all the employee’s relatives seem to care about is money. Thus, this begs the following questions:

1.What exactly are the relatives doing with the money they get?
2. What are their plans should their relative stop sending money?
3. What are they thinking if they assume that they can depend on their OFW relative indefinitely?

Although this family is just one among many in the Philippines, the questions above can be posted to just about everyone. Substitute OFW for any other able-bodied relative, and there you go. In addition, it does not always have to be about what your relatives are doing with your money, but what you yourself are doing with it.

The Philippine Inquirer has several articles on comments Ms. Orman made during her visit. The list follows below. This makes one wonder though, why the PDI has more articles than the other publications.

1. Helping people who can take care of themselves is not helping the Philippines
2. Parents should never tell a child they hate having to leave home because they have to work.
3. Philippines to shine in global community soon

In essence, Ms. Orman is not really saying anything that we do not already know. However, how many more people like her do we need telling us that the way we look at, and handle money as a people, is not sustainable? In my opinion, this is the line that drives it home: “Helping people who can take care of themselves is not helping the Philippines”

The OFW remittances, as a source of money for the Philippine economy, is in peril, all the more so now because of the unstable political situation in the Middle East. What will happen if we need to recall all our OFW’s stationed in that region? What would happen if all foreign governments would stop accepting our OFW’s, for one reason or another? The economy would, for lack of a better word, crash.

People may remember the prediction HSBC made about the Philippines in January 2012, where it was said that we could leapfrog to be the largest economy by 2050. It is not hard to imagine that this piece of news sent many people jumping for joy and exclaiming “Proud to be Filipino!”, or what have you. The way things are currently going, it looks like this prediction will remain just that – a prediction. However, an-out-of-the-box thinker would ask “why wait for 2050? We can start the road to a bigger, better economy now!”

Unless we start changing our financial ways now, we are only setting up ourselves for disappointment yet again. I dare say that it is not a stretch to imagine that by 2050 people will still be waiting for dole-outs, whether from the government or from their relatives. This is the financial equivalent of waiting for the guava to fall from the tree!

If we want to be able to manage our money better, and to start moving away from relying on dole-outs, which the OFW’s remittances are the best example of, we’ve got to start with ourselves, and now. I understand the feeling that paychecks are rather transient. I experience that every single pay period, because I am also part of the work force. What I do not understand is putting oneself in debt, just to satisfy a transient feeling of happiness. What I do not understand is throwing away money needlessly for the vacuous notion of “pakikisama”. What I do not understand is the balato mentality, as one commenter had put it, that other people feel when they see others with money they themselves don’t have. Through personal experience, I have become wary of the phrase “share your blessings”. Most importantly, what I do not understand is the aversion to work that certain Filipinos have. Instead, they rely on, and think they are entitled to, being supported by their relatives who are serious about working, yet who are hesitant to voice their displeasure.

Do not get me wrong, money is not the single definitive way to define happiness. However, once we have more of it, we are in a better position to make ourselves happier, and our life better off. Next is the hard part: redefining how we think about happiness, and being serious about it. For more on happiness and why we need to be serious about it, let Ilda explain here.

That being said, our government has its own part to play too. How can they help? For one, relaxing or downright removing barriers to foreign companies setting up shop here is a start. If they stopped coddling the oligarchs, who insist on monopolies, that would be even better. I am sure that you, the readers, have even more suggestions as to how the government can help provide enough jobs for its own people, and thus put more money in their hands. I leave it as an exercise.

We should not have to be reminded that as citizens, it is our responsibility, no, our duty, to make sure that they do it right, and that they keep doing it that way.

Paging President Aquino, as soon as you are done micro-managing the impeachment trial, and putting your foot in your mouth, get up. The economy needs you. It has needed you ever since the start of your term!

21 Replies to “Filipino attitude towards money highlighted yet again”

  1. What we need is a comprehensive plan that will enable Filipinos to become business generators. It has to start with the way we educate our students to the way we make it easy for entrepreneurs to register and put-up a business.

    Much has been said about big businesses and multinational companies creating jobs. But it is with the MSMEs that generate about 70% of jobs in the country. If we make it easier for Filipinos to start their own businesses, by getting loans and one-day business processing, etc., we will be having more jobs available for our graduates.

    All First World Countries encouraged entrepreneurship and even assisted their citizens in putting-up businesses. Why can’t we do the same here?

    1. Here are a few reasons:
      1. Outside major cities, local politicians run fiefdoms and dip their hands into every aspect of business life.
      2. In major cities, business permits are so bound up in red tape, it actually costs more just to get a permit than to start one (try starting a business in the city of Manila and find out how much money you have to shell out, on top of costs shuttling back and forth and days lost. And that’s if you don’t bribe anybody).
      3. There is no consistency in applying for business permits anywhere in the Philippines. And, there being no systematic consistency, yoou’ll have to haul all your hard-copy paperwork around.
      4. On top of local permits, you have national agencies to deal with if your business requires them. More delay, more money spent. I.e. Environmental clearance certificate.
      5. Just starting a business is an exercise in built-in obsolescence. You can have 3 years just to do the paperwork, and already you’re a pauper.

  2. FallenAngel

    The NSCB site (I’m in their mailing list) provides a table showing the Percentage Distribution of Total Family Expenditures by Major Expenditure Group.

    This table I have is for year 2006 yet–with no available data for any year after that, and definitely no data on OFW family expenditures since.

    Anyway, the NSCB term “Family Expenditures – refer to the expenses or disbursements made by the family purely for personal consumption during the calendar year 1997. They exclude all expenses in relation to farm or business operation, investment ventures, purchase of real property and other disbursements which do not involve personal consumption.”

    Thus, since the listed “expenditures” exclude expenses “which do not involve personal consumption,” the NSCB table, as to be expected, does not provide data on family expenditure (if you can call it that) on INTEREST PAYMENTS for personal loan amortizations, like credit cards and small individual loans.

    The exclusion of “interest payments” is significant, for what if the amount for interest payments on personal loans alone that a family regularly sets aside exceed, say, a third (33%) or even as high as 50%, of a family’s monthly gross?

    In short, interest payments, percentage-wise, should be included in determining family expenditures to provide a more accurate data on how family income earned (in particular the OFW remittances) is distributed and how such inclusion affects the family “happiness.”

  3. Cooperatives can help a lot, especially the politically non-aligned ones. But they work only where “balato” has not taken root as a culture, such as among the hill tribes of the Cordilleras and other indigenous people. Co-ops also work among real entrepreneurs, because the banks can deal easier with co-ops than with individuals.

    So long as politicians are held at bay from entrepreneur initiatives, then people rise and fall by their own merit.

  4. Pls dont blame the government always for not creating enough jobs. There are simply too many mouth to feed in the Philippines. Pls blame the church, the religion but foremost those who f*ick in the name of god.

    1. Hello Mr. Haighton,

      Perhaps because religion is taken for granted here, we tend to forget that it usually does more harm than good for our financial well-being. I guess when they said “go forth and multiply”, people thought the money would too. Oops.

      It ultimately boils down to the individual to think. The problem is that the church is among one of the many institutions which do not promote this. If I remember correctly, they have something called “giving till it hurts”, which is frankly BS.

      I just want to say that I do not condone blaming the government either. That is why I said that government has its own role to play to increase money supply, and that we should make sure, as citizens, that they fulfill it.

      1. FallenAngel,

        I read here the other day that THINKING is not stimulated, not encouraged, not promoted. Who’s fault is that? Also the government’s? What happened to the individual responsibility. Is there nobody out there who says “enough is enough” followed by “And now I demand proper education the same way students in the west get”. Pls stop playing the victim role. Why do you think that during WW2 the Dutch resistence bloomed and flourished? Simply, bec certain individuals said “enough is enough”. How many brain cells does it need to speak so few words?

        I consider myself not an expert about the Philippines but I like to think I know a few things about the country.

        And my conclusion is this: “ITS REALLY NO FUN TO BE IN THE PHILIPPINES”.

        In my humble opinion this is what should change and fast:
        – the way kids are brought up and raised
        – the curriculum of each level (Kindergarten, elementary, secondary, high school, college, university) of education should be modernized
        – the government should give people choices and legalize abortion, euthanasia and divorce
        – modernize the culture from the poorest to the richest
        – a clear seperation between church and state
        – the private sector should create only good jobs and not meaningless low-paid jobs
        – the government (national, province and city) should go back to their core-business.
        – there should something be done about the over-population. Personally I think the RH-bill will not work. Although I am not against the RH-bill but I have strong doubts if it will ever sort effect.

        There are too many people and less jobs. You want to create meaningless jobs. Dig a ditch and somebody else can then throw the sand back??

    2. The government can be blamed and rightly so. It has every opportunity to improve ways on making it easy for entrepreneurs to start businesses, but it does not do so. We’re talking about encouraging business and not giving handouts. Hell, those handouts are another reason why people aren’t taking up jobs; they’d rather rely on freebies from the state.

      Ever applied for a passport? Notice how it’s fairly easy to have a thumbprint, sample signature, and photograph taken at the DFA office? Now why can’t the government make the DFA share those samples with the NBI, so as to make applying for an NBI clearance easier? Why can’t that same information be shared with the LTO to make applying for a driver’s license quicker? A bunch of servers and trained staff to maintain the database costs less than pork barrel funds for 188 congressmen; all that is needed is for state agencies to share basic information that is for the convenience of the whole citizenry.

      Blaming the prelates for too many mouths to feed is pointless, when it is the government’s job is to make it simple for people to transact business.

  5. In your 3rd paragraph, you stated that “That they are the result of a government who cannot provide jobs locally to support as many Filipinos as possible is simply appalling.”

    It is not the government’s role to provide jobs. It is government’s role to create an environment through laws/policies and the execution thereof that would be conducive to job creation.

    The notion that government provides jobs is not entrepreneurial thinking but smacks of patronage…even though I know you did not intend that to be your point.

    Further, the assertion oversimplifies the matter…making government apparently the sole reason for all that ills the Philippines. Certainly, government has had a big share, but as we all know, a nation’s fortunes are determined by a host of many factors such as (and this is far from an exhaustive list…considering that I only listed 2 things):

    1. Government – And for “simplication’s sake”, we have tax policies that doesn’t make sense (e.g., carrier’s tax to airlines which in a BBC article explains why their are so few direct flights to the Philippines from NA and Europe); culture of corruption in government, etc. etc.

    2. Private sector – again, this is a monolithic label and is too sweeping a statement….but just to give an example:

    There should be a stronger culture of entrepreneurship…a small/medium scale business culture that aims to employ people. In many advanced countries, the largest creator of new jobs are SME’s. In the Philippines, there is a lack of business support infrastructures to help SMEs take off. While not impossible to take off, the obstacles are there. Among its citizens, there is also a lack of vision to aim to build a business that generates employment beyond oneself…and not just a mom-and-pop operation that employs only oneself.


    I can go on-and-on about many other factors that contribute to the dismal creation of jobs – – a thing that primarily must be led by the private sector.

    Of course, one can claim that all roads lead to the government (e.g., if the govt was not corrupt, I will pay my taxes to support infrastructure growth; or if the govt had better laws, more people would be encouraged to open businesses).

    But that again is scapegoatism (although I will have to stress that government’s actions are part of the problem).

    We should not forget that everything is connected…..for example – we have private interests lobbying govt to enact laws that favor them….the entrepreneurial culture in the Philippines is not fully developed or of the nature that intends to build something sustainable and employment generating…..that we have good laws but don’t have the money to implement, personnel to implement, or perhaps not being implemented properly, etc.)


    So in conclusion, my main points are:

    1. Gov’t is not the engine for job creation….the private sector is. The government is there to help create the environment and create infrastructure that cannot be built by private industry to support the businesses that create jobs.

    2. I wish articles on the blog would be less whiny. When I read the blog’s manifesto…it was a call to arms….something inspiring….we will change the Philippines. But somehow, the blog has degenerate in a partisan blame game no different from some of the partisan cable news networks in the States. All blame. Everything is black and white. One party is good, one party is evil. Even the rhetoric is almost poisonous….the labels used on people, etc…..and it is almost like there is no civil discourse anymore….that he who shouts the loudest and uses the most incendiary attacks and language would be the one most likely to be heard……

    I think it’s about time that some redeeming value come out of articles posted on the blog that somehow inspire people to do something rather than make them feel coming out deflated, cynical, and hating everything about the country. I think that’s what has been lost in the Get Real Post blog….a sense of mission to transform society rather than a megaphone for rhetoric.

    I am not saying that we should read/hear only the things we want to read/hear. I applaud your efforts to expose wrongs….but if this blog is to be transformative…it should strive to lay out the problems in a deliberative manner rather than in an accusatory fashion…seemingly always an indictment of everyone but oneself….and giving a sense that if certain things are done….then we somehow move towards a positive direction.

    Be more of a think tank blog of ideas which was what the manifesto was all about…rather than a blog full of political commentaries that are highly partisan and in many cases cynical and leaving readers with no sense of hope.

    (Caveat – – – I just typed continuously and didn’t check spelling etc….I know, lousy, lousy, lousy….but I really need to rush to go to work…as I don’t live in Manila and it is 10 am over here)

    1. @Gregory Macaltao,

      Wow, I couldnt have written that any better than you did. I so much agree with you.

      Although I do think there are more things to look at, already stated in a previous post here on this page.

      (Breda, Netherlands, Thursday 8 March 2012 at 7.47PM dutch time)

  6. I don’t think this article is “highly partisan,” in the sense that it does not claim to represent any “political party” at all. Even then, those who post (and some of those who comment on) articles in this blog are merely voicing out their particular concerns. And that is precisely what the author of this article is doing–exercising his right as a citizen of this Republic to criticize what fallenangel perceives to be wrong with how this government is being run. You have your own concerns, I have mine and all involved Filipinos for that matter have their particular concerns too.

    To fallenangel, this blog becomes the forum–the non-violent outlet, I might add–for such concerns in the articles he writes, and that goes for all the others I have read in this blog.

    If you think that fallenangel’s manner of presenting his particular concern is articulated in an “accusatory fashion,” then, let it be; in fact, it should BE that way, more “whiny” if need be. For this guy is exercising a sovereign power the Filipino people did not relinquish to government they created–the ELECTORAL POWER (Meiklejohn)–“electoral,” for this is the reserved Power Filipinos jealously retain to choose those who would wield the other sovereign powers they delegate to government they ordained and established.

    And this Power can only be effectively wielded–between elections–if the Filipino exercises in the interim his right of free speech to criticize, to accuse, to BLAME if circumstances demand, those who merely exercise delegated powers in order to convince and persuade the doubtful, the uncertain of whatever cause the citizen wishes to pursue for a peaceful turnover of government during any electoral process of change.

    If obedient silence is what your vision of a citizen is, then, let it be, too; you certainly possess the right to advocate that cause; but that is not the only way, of course. This article fallenangel authored suggests another way; so, rather than, condemn, let us allow the author the opportunity to push for its acceptance or outright rejection in the free marketplace of ideas–“No law shall be passed …”

    In fine, before the call to arms (or “appeal to heaven,” Locke), Filipinos should be afforded–and ONLY Filipinos, mind you, who owe allegiance to (and are willing to put their lives on line for) the Republic of the Philippines–in forums like this blog, the avenue, constitutionally paved, to freely exercise their right, nay their duty and responsibility, to criticize government.

  7. First and foremost, 0% corruption rate will not give you enterpreneurship and economic growth. It may hamper them but not provide them.
    And FYI, you cannot eliminate corruption completely only lessen it – that is a reality. Nevertheless, first-world countries are able to have thriving economies even when there are corrupt government practices in their territory.

    We should not depend on the government for more jobs and business generation. That would only result to additional tax burden on the people.

    What we need is charter change to remove the 60/40 protectionism law and open up the country to foreign investments like what developed countries has done. Sufficient well-paying jobs would give the Filipino people capital to invest to businesses.

    Capital would be available at that time. The only problem left to solve is how to change the Filipino rotten mentality towards spending money.

    1. Simply put, 0% corruption rate is absolutely impossible.

      Government has its role to play, but the burden should not entirely be shifted to them. Breaking barriers to more opportunities is one of their most important ones.

      How to change the Filipino rotten mentality towards spending money — now THAT is the challenge.

      1. The burden shouldn’t be entirely shifted to the government, but when it enacts practices and policies that hamper entrepreneurship and a level playing field, then it should get the blame.

        Getting a business permit doesn’t take a day in many decent countries, even some third world ones. Authorities there recognize that less red tape means quicker and more revenue. Thus far, it is only in the Philippines where I have experienced weeks of lost time and capital just to secure the necessary papers before even applying for a business permit. The permit itself took away months, in the end I had to take out a loan to start the business. And that was the procedure without bribes. Yet every time I demanded an explanation for the dopey process, all I got was a shrug, a smirk, and “that’s the way it is”.

  8. Didn’t they start seriously considering restarting the process of constitutional amendments there last year? Whatever happened to that?

    1. any attempt at constitutional amendments will be shot down for a long time to come because there are lawmakers who see this as a threat to their ways of kurakot

  9. Obedient silence = Blanket resolutions
    Seen this in the private sector. Tried to fight against it but it was a lost battle as everyone wants to keep the “zone” they’re in. It’s more harmonious as they say. Always living in live present, worried about the future but never doing something about it. Try to fight it, you are the enemy.
    It is not just the government at fault, it is us citizens who are complacent. It is us who gives up even if we know something can be done. It is looking for alies even if we are wrong.
    Financially, yes life is difficult here. Isang kahig, isang tuka for many. But those who often worry about money are the one with vices. People who feel entitled to be proveded dole by relatives and friends. Our culture lack financial maturity and tje government likes that because it counts as their vote on election. It is a cultural thing. And it is shameful.

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