The Debt-FREE Lifestyle

Towards a
Financially-
Literate
DepEd
“Rather go to bed without dinner than to rise in
debt”
Benjamin Franklin
The Truth…
“People today are ADDICTED TO

BUYING.”
“Too many people spend money they haven’t earned to
buy things they don’t want to impress people they don’t
like.”
-Will Rogers-
Five Harmful Financial Traps
Trap #1
Lack of Knowledge
Borrowers are slaves.

People who are deeply in debt did not plan to
be so. Often they are ignorant about financial
matters, They do not know how to use their
money wisely, and often fall into financial
traps.
Trap #2
Easy Credit
One trap is easy loan offered by unscrupulous

money-lenders to uneducated minimum wage
earners, factory workers, and even office
workers.
Because wages are not enough to make both

ends meet, workers borrow from each other
and from unscrupulous individuals or bogus
financiers.
These loan sharks make sure they get hold of

ATM cards. Workers end up pawning their
ATM Cards. They usually charge very high
rates.
Trap #3
High Interest Rates
Usury or interest is a nashakh or neshekh in

Hebrew which is describes as “bite of a
snake”.
If you are borrowing at high interest rates or

paying at high interest is like being bitten by a
serpent which may eventually lead to death.
On the other hand, if you’re making money by

lending at high interest, take not of the
warning of Solomon: “Income from charging
high interest rates will end up in the pocket of
someone who is kind to the poor.”
Trap #4
Guaranteeing other’s debt
Some people incur loans because they

think they can help by borrowing for
others. This is when helping is bad.
As Filipinos, we feel obliged to help

another in need, especially when that
person is a relative. Instead of saying no,
many of us borrow money to cover for
another.
As Filipinos, we feel obliged to help

another in need, especially when that
person is a relative. Instead of saying no,
many of us borrow money to cover for
another.
Trap #4
Incurring credit card debt
The most harmful and pervasive financial

trap id the unwise use of your credit
cards.
Discipline and organizational skill are

needed to monitor credit card purchases.
Many are not able to pay their bills on
time, so they end up owing huge
amounts to credit card companies.
The great danger of the credit card habit

is that:
1. It lulls you into thinking you have

money when you really don’t;
2. You end up buying something you

don’t have cash to pay for; and
3. You tend to buy more, pay more, worry

more, and fight more.
You buy more.

Credit card users end up spending 25
percent more than they intend.
You pay more.
If you don’t pay the bill in full by the due
date, your credit card company will
impose an interest of 3 to 5 percent per
month.
You worry more.
“Peace is the softest pillow”
People who do not have debts sleep
better.
You fight more.
Money matters occupy much married
couples’ quarrels.
You fight more.
Money Magazine polled 1,010 married
adults aged 25 and over. Survey results
showed that 70 percent of couples
argued about money more than others.
You fight more.
Many marriages break up when couples

become broke.
You fight more.
The holy vow of matrimony, “Till death do

us part” becomes “Till debt do us part”.
You have less freedom.
When you’re in debt, you’re enslaved to

your creditor.
You have less peace.
After you borrow today, how sure are you

that you will still have your job next
month or next year?
You have less time.
You’ll also have less time for your family
because you have to work doubly to pay
back your loan. You’ll not even have time
for your social life.
You have less joy.
When you’re tired from trying to pay off

your debt, you’ll have less joy in life.
Easy to Remember Principles
A,B,C,D,E,F,G,H,I,10
Principle A:
Administrator, Not Owner
Principle A:
Everything we have comes from God. All

material and non-material things are
merely entrusted to us.
Principle A:
If we only realize that we do not truly own

anything, even those that we have
bought with money we earned- then we
would look at material things differently.
Principle B:
Budget Instead of Impulse Spending
Principle B:
You must first know how much your

income is, how much your expenses are,
and try to fit them together.
Principle B:
“Money is like fat- there’s plenty of it, but

it’s always in the wrong places”
Principle B:
It’s not a matter of how much you earn.

Its how much you save.
Principle B:
You may just be a domestic helper, yet

you may be able to own land if you
manage to save by living way within your
means.
Principle B:
Do millionaires go bankrupt?
Principle B:
Somewhere between 60 percent and 80

percent of athletes in the NBA and NFL go
bankrupt within five years of retirement
despite making an average of $5.15 million
and $1.9 million per season.
Principle B:
Former NBA player Antoine Walker earned

$110 million and lost it all.
Principle B:
NBA player Vin Baker went broke despite the

$93 million that teams paid him during an All-
Star career.
Principle B:
Mark Brunell made $50 million over the course

of his NFL career and is now $25 million in
debt.
Principle B:
Many millionaires lose their millions because:
1. They do not know how to budget their millions.
2. They fail to plan for the future and to set aside a
portion of their income regularly.
3. They assume that the avalanche of blessings will
keep coming.
Principle B:
If income exceeds expenses, then there is

surplus and more happiness.
Principle B:
If income is less than expenses, then there

deficit and sadness.
Principle B:
Your total expenses should be less than your

income.
Principle B:
Simple Steps to Proper Budgeting

Principle B:
1. List down all your income- salary, bonuses,

love gifts, consultation fees, etc.
Principle B:
2. List down all your expenses everyday for

the next thirty days. Jot down every single
thing you paid for everyday.
Principle B:
3. Categorize the kind of expenses you have

listed down.
Principle B:
4. Determine which categories are priorities or

the most necessary expenses.
Principle B:
5. Determine how much you want to spend on

each category per month.
Principle B:
6. Stick to the budget as if you’re life depends

on it.
Principle B:
Some people have successfully used a proven

system- use of envelopes labeled according to
the categories in their budget.
Principle C:
Cut Your Credit Card
(if necessary)
Principle C:
Progressive countries are moving into

cashless transactions, avoiding the carrying of
checkbooks and the risks of holding excessive
cash money.
Principle C:
Credit cards are good and convenient,

especially when travelling and during
emergencies.
Principle C:
However, credit cards may delude you into

thinking you have more money than you really
have.
Principle C:
The promise of instant gratification lures you

into the trap of debt and financial slavery.
Principle C:
When a CEO was questioned about giving

credit cards to people who couldn’t manage
their cards well, causing them to pay a lot of
interest and penalties, he replied:
“That is where the money is.”
Principle C:
LOANS rearranged spells LASON (Poison)

Principle C:
Tips for using credit cards:
1. Get one credit card only
2. Buy in cash
3. Pay the total bill in time
4. Don’t be greedy for points.
Principle C:
Remember:
Whether you are rich or poor, educated or

not, you can be enslaved by the credit card
habit.
Principle C:
Worse than credit cards loans
The 5-6 is a notorious loan method in which

one borrows PhP5 and pays back PhP6.
Principle C:
When to borrow or not to borrow?

Principle C:
1. Don’t borrow to buy anything that

depreciates.
(cars, appliances, gadgets)
Better save first before buying.
Principle C:
2. It’s OK to get loans to buy house or

unit. But be wary of banks or financing
companies fixing the interest rates for
only one or two years.
Principle C:
The rule of the thumb is:

Your monthly amortization should not be
5 percent more than your current
monthly rent.
Principle C:
3. Don’t borrow to pay off your debt.

(Unless it is at interest that is lower than
your existing one.)
Principle C:
4. Don’t borrow at high interest rates.

(A difference anything higher by 6
percent is too high)
Principle D:
Demolish Debt (Pay It Off ASAP)

Principle D:
It’s better to tighten your belt now

rather than later.
Principle D:
Endure hardship now while you’re

still young, able, and healthy.
Principle D:
Your financial freedom starts only as soon as

you pay off your current loans. It means giving
up movies or fine dining for the next few
months or years, do it.
Principle D:
Schedule your payments, and plan what you

need to give up. Your goal is to have a clean
slate as soon as possible, so you can start
rebuilding your life and become financially
free.
Principle D:
How got out of debt?

Principle D:
1. If you have assets to sell, sell them.

Principle D:
2. Don’t run away.

Principle D:
3. Negotiate.
Principle D:
4. Budget your money well.

Principle D:
5. Simplify your lifestyle.

Principle D:
6. Manage the resources God has given you.

Principle E:
Education, the Greatest Wealth

Equalizer
Principle E:
Education, the Greatest Wealth Equalizer
How does one escape poverty?

One of the best ways is by getting good
education.
Principle E:
An education helps one to be gainfully

employed, set up a small business, or do well
professionally.
Principle E:
Ways to increase financial quotient:
•Read books
Principle E:
•Seek the professional advice of financial

experts
Principle E:
•Watch educational television programs

Principle E:
•Attend seminars on financial management

Principle E:
•Browse the Web for information

Principle E:
•Ask friends who are wise financial managers

Principle F:
Family Planning
Principle F:
Family Planning
Planning is critical part of life.

Principle F:
Family Planning
Family planning is planning not just

the number of children we’ll have,
but also planning to give our children
the best opportunities in life.
Principle F:
Family Planning
Family planning is planning not just

the number of children we’ll have,
but also planning to give our children
the best opportunities in life.
Principle G:
Grateful to God, Generous to

Others
Principle G:
Grateful to God, Generous to Others
Gratitude is the winning attitude that

makes us generous to others and
content with what we have.
Principle G:
Grateful to God, Generous to Others
Warren Buffet said, “The happiest people do

not necessarily have the best things. They
simply appreciate the things they have.”
Principle H:
Honest, Hard Work

(Not Easy Money)
Principle H:
Honest, Hard Work
(Not Easy Money)
Better be poor and honest than to be

dishonest and rich.
Proverbs 26:6
Principle H:
Honest, Hard Work
(Not Easy Money)
Wealth from get-rich-quick schemes

quickly disappears; wealth from hard
works grows overtime.
Proverbs 13:11
Principle H:
Honest, Hard Work
(Not Easy Money)
Don’t run after easy money.

The greedy person is driven here and there by
many wants.
Principle H:
Honest, Hard Work
(Not Easy Money)
Don’t fall for “get rich quick” schemes.

If something sounds too good to be true, then
it is too good to be true.
Principle H:
Honest, Hard Work
(Not Easy Money)
Don’t gamble.
Ninety-nine percent of people who gamble or
buy lotto or sweepstake tickets lose their
money.
Principle H:
Honest, Hard Work
(Not Easy Money)
The stock market-is it investing or

gambling?
It’s an investment if you spend a lot of time
and energy studying it.
Principle H:
Honest, Hard Work
(Not Easy Money)
The stock market-is it investing or

gambling?
It’s a gamble if laypersons just buy and sell
based on rumors, tips, and hearsay.
Principle H:
Honest, Hard Work
(Not Easy Money)
Honest, hard work reaps rewards
Work hard and become a leader, be lazy and

become a slave.
Principle H:
Honest, Hard Work
(Not Easy Money)
Lessons from parents:
1. Always save.
Principle H:
Honest, Hard Work
(Not Easy Money)
2. Don’t borrow money from anyone.

Principle H:
Honest, Hard Work
(Not Easy Money)

3. Don’t borrow clothes, not even from your
sisters. If you only have two dresses, those
are the only ones you will wear.
Principle H:
Honest, Hard Work
(Not Easy Money)
4. Learn to sew and work with your hands.

Principle H:
Honest, Hard Work
(Not Easy Money)

5. Always live well within your means. Don’t
save what is left after spending, but spend
what is left after savings.
Principle I:
Invest for the Future,

Invest also in Eternity
Principle I:
You need to have a vision for the

future, and you need to see time as
an invaluable resource.
Principle I:
Never depend on a single income,

rather, make investments to create a
second income.
Principle I:
How to invest in eternity?

• by giving portions of their income to the Lord
• share the Gospel
• give to the needy
Principle 10:
10:20:70
Lord 10%, Save 20%, Spend 70%
Principle 10:
10:20:70
God blesses generous givers.

Financial debt is certainly an all-important
issue that must be dealt with decisively in
our lives.
Thank you po!

The Debt-FREE Lifestyle

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The Debt-FREE Lifestyle

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Towards a

“People today are ADDICTED TO

Borrowers are slaves.

One trap is easy loan offered by unscrupulous

Because wages are not enough to make both

These loan sharks make sure they get hold of

Usury or interest is a nashakh or neshekh in

If you are borrowing at high interest rates or

On the other hand, if you’re making money by

Some people incur loans because they

As Filipinos, we feel obliged to help

As Filipinos, we feel obliged to help

The most harmful and pervasive financial

Discipline and organizational skill are

The great danger of the credit card habit

1. It lulls you into thinking you have

2. You end up buying something you

3. You tend to buy more, pay more, worry

You buy more.

Many marriages break up when couples

The holy vow of matrimony, “Till death do

When you’re in debt, you’re enslaved to

After you borrow today, how sure are you

When you’re tired from trying to pay off

Everything we have comes from God. All

If we only realize that we do not truly own

You must first know how much your

“Money is like fat- there’s plenty of it, but

It’s not a matter of how much you earn.

You may just be a domestic helper, yet

Somewhere between 60 percent and 80

Former NBA player Antoine Walker earned

NBA player Vin Baker went broke despite the

Mark Brunell made $50 million over the course

If income exceeds expenses, then there is

If income is less than expenses, then there

Your total expenses should be less than your

Simple Steps to Proper Budgeting

1. List down all your income- salary, bonuses,

2. List down all your expenses everyday for

3. Categorize the kind of expenses you have

4. Determine which categories are priorities or

5. Determine how much you want to spend on

6. Stick to the budget as if you’re life depends

Some people have successfully used a proven

Progressive countries are moving into

Credit cards are good and convenient,

However, credit cards may delude you into

The promise of instant gratification lures you

When a CEO was questioned about giving

LOANS rearranged spells LASON (Poison)

Whether you are rich or poor, educated or

Worse than credit cards loans

The 5-6 is a notorious loan method in which

When to borrow or not to borrow?

1. Don’t borrow to buy anything that

2. It’s OK to get loans to buy house or

The rule of the thumb is:

3. Don’t borrow to pay off your debt.

4. Don’t borrow at high interest rates.

Demolish Debt (Pay It Off ASAP)

It’s better to tighten your belt now

Endure hardship now while you’re