This is not a get-rich quick scheme, it is a plan and these are the first two milestones you should aim for.

In my previous blog posts, we have tackled several problems being faced by many Filipinos today. It looks hopeless as many more begin to go down that path. These problems are:

I myself only began to make this realization about money and wealth after a year of working. I was one of those who lived paycheck to paycheck and who took money for granted. It all came to me the moment my father asked me one day, “How much have you saved?” then I began counting and adding up my pay for one year and noticed that I had nothing to show for it at all!

That was when I began reading through books, articles, and blogs about personal finance and it opened me up to a completely new way of thinking and living.

I must say though, after 3 years of doing and researching, I am still in the process of refining my own personal finance style but I wanted to share what I had with you all.

I want to change, but where do I start?

In my last blog post, I challenged you to save at least Php100.00 from your pay and put it somewhere and just keep on saving. I mentioned that it was discipline that you needed and that you needed to start, no matter how small. That is the key to personal finance — discipline and starting small.

Whatever your situation may be, the very first thing you need to do is to start with yourself. A big part of the problem is you, and the only solution will be YOU. What do I mean by starting with yourself?

Many financial problems are not caused by people not knowing what they must do nor is it merely about their hardships in life. Think about it for a moment, we all know that we must save for the future, we all know that we should not buy what we could not afford, we all know that not all of things we’re spending on are necessities and that we could forego a lot of them — but we do them all anyways! Many financial problems are caused by people not knowing how they could do what they want to do and many more are caused by people not realizing that they are heading down a path that is destructive.

This is why I am introducing to you a way on how you could begin with your financial journey through what I call milestones and you have already taken the very first steps by realizing the possible causes of our financial problems. So, what’s next?

My First Milestone: What is wrong?

You may read through my previous blogs for this, try listing down your main problems when it comes to your financial situation. We all have our challenges but they key here is that you are also writing down what’s causing these problems. You will find that a lot of these may be coming from you.

My Second Milestone: How are you doing now?

The very next step one must take is to know where you are financially. Are you down in debt? Are you living paycheck to paycheck? Have you started to save? All of these should answer the question of where you are now and it is very simple to do. Get a piece of pen and paper and begin writing.

How much do you own?

How much you own is basically your net worth. For companies or businesses, these would be their assets and its value would basically determine how much the net worth of the company is. On a personal note, we could translate this to the following:

How much do I have saved?

- List down all of your bank accounts, piggy banks, wallets, coin banks that you may have on the left hand side of the paper and then write down much you have in each of them.

- List down all of your bank accounts, piggy banks, wallets, coin banks that you may have on the left hand side of the paper and then write down much you have in each of them. If you own a land, an apartment or any property, list them down along with their current value

If you own any jewelry you may also include these and any other items of such value you may have

You may or may not include your car or motorcycle in the list. Just remember to put in their current value!

If you have your own business, do not include it in your personal “ownership”!

How much do you owe?

How much is your debt? List them down, everything, and write down how much you owe in total and how much you have left to pay.

What is your net worth?

Now, the next thing you must do is add up all the things you own and owe and follow this formula afterwards:

Net Worth = “What you Own” minus “What you Owe”

Congratulations! You’ve done it! How much is your net worth? What do you think about it? This is the very first step you must do in your financial journey, just right after you begin realizing what your problem is. This will be your stepping stone to help you in your next milestones that we will be aiming to achieve in the next few blog posts.

Do not be hasty in this process, we must all start somewhere and you are taking your very first steps towards financial success. You may feel sad or happy about the result of your net worth calculation — the thing is, you have to feel something about it. Take your time to reflect on it before you begin taking steps for your next milestone.