Poverty and work abroad. What’s the connection?

Work abroad is probably one of the most common advantages of globalization. It has benefited a huge number of families who were unable to take proper care of their loved ones. Foreign countries offer a huge array of workplaces that pay relatively well and give the benefit of “no-doubt” for the future.

As a financial institution with years of expertise working with expats and foreign workers, we have noticed one strange correlation between working abroad and actual poverty.

Why is it so? Isn’t work abroad supposed to handle the financial insecurities of the family and the worker himself?

Andrea Anolin, CFO executive assistant for joint migration and development initiative said on this occasion: “People tend to think that once you go abroad, it seems that you get a higher income and that will solve all your problems,” adding that many OFW families may already have financial problems and be deep-stuck in debt even before leaving the Philippines. This can often be the result of accumulation of debts due to over-borrowing as these families and workers believe that the money can be returned once hired overseas.

“The families who are left behind and also the migrants themselves have very unrealistic expectations. They equate going overseas with an automatic improvement in the quality of their lives”.

Another “evil” for such families is the constant nagging for money by their families left behind. Most OFWs are said to easily give in to the requests of their families and relatives for remittances and gifts from abroad. This results in the need to work even more or do illegal jobs, risking their health and working status.

This is a huge mistake: the inability to save an adequate amount of money and take the “debt-first” attitude results in a never-ending circle of debts and staying away from the family for more extended periods of time.

What do you have to do to be financially secure? Read this article by WorldCom Finance.

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3 Tips to Manage Your Finances from WorldCom Finance

As a company that has worked in the niche of finances for over a decade, we have seen a lot of examples of how the inability to build a budget and stick to it has played a bad joke with a big number of people. Therefore, we always encourage every foreign worker to keep track of their budget. Let’s look at three simple tips that will shed some light on how to stay financially secure all the way!

        Start with budgeting

What do you need to do? Simply keep track of all your expenses for a period of one month. There’s no need to try to save, just be your natural self as you spend. This is necessary to get an idea what your actual expenditure is like. If you have to make big payments at a given month (e.g. education, mortgage), make sure to include the fair share of this money into the expenses of that given month. As the calendar turns, it’s time to face the true picture of your expenditure?

2      Count the sheep

After the month ends, collect all your receipts, and notes of spending and add it all up together. Start by listing the actual sum of your salary/income, and go on listing what you spent money on. As an overseas worker, this list is so important to you: it determines how soon you can get back and reunite with your family.

Let’s look at these 2 lists:

List 1:

Actual income: $1500

Sent home: $700

Rent: $150

Household bills: $75

Groceries: $150

Dining out and drinks: $100

Emergency to family: $200

Gas: $50

Personal expenses: $100

Remaining: -$25

List 2

Actual income: $3,000

·         Sent home: $800

·         Rent: $400

·         Household bills: $125

·         Groceries: $100

·         Dining out and drinks: $100

·         Gas: $100

·         Emergency: $ 100

·         Personal expenses: $400

Remaining: $875

See the difference? In the second budget, there is some money allocated for savings, and that is what you need to achieve.

       Write your new budget

Now that you know how much you spend, you can also make sure to run your budget in a way that cuts down on unnecessary expenses and gives you room for savings. For example, if you spent $300 on dining out and drinks, you may want to cut down this expense and only spend about $150 on this. You should try to avoid debt at all costs, at the same time allocating a realistic sum for savings. Don’t strain yourself to the point of hating your budgeting, bu make sure you don’t spend what you haven’t earned, too!

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