The Social Status Trap and Why You Should Avoid It!

“Social Status = Financial Status”

This is one of the leading causes of poverty in the country. Ang paniniwala ng tao na kapag nag-improve ang kanilang social status, eh nag-improve na rin ang kanilang financial status. Meaning nag-improve ang kanilang buhay.

 For example

  • Bago ang cellphone mo, aba may budget!
  • Bagong bili ng kotse, ayun o, can afford!

At ang kabaliktaran naman

  • Kapag naguulit ka ng suot sa office, yuck ang chaka.
  • Kapag di sumasama sa outing, walang pakisama, wala lang sigurong budget.

So many people have the belief that if you increase your social status, by the things you have and the things you do, by improving your image, and how people think of you, then it means you are progressing financially. Now as I said, this is very dangerous. Because the reality is…

  • Increasing your social status usually means decreasing your financial status
  • Kapag pinataas mo ang social status mo, ang iyong financial status ay bumabagsak

The Real Measures of Financial Status

The financial status of a person can be measured by two factors:

  1. Excess Cashflow – How much do you earn in excess of expenses?
  2. Earning Assets – How much of your money is earning more money for you?

 

Ang dalawang ito ang pinakamagandang basehan ng financial status ng isang tao. Bigyang pansin natin gamit ang halimbawa ng magkaibigang si Pedro at Peter. Pedro and Peter are officemates at a large multinational company, each earning P50,000 a month. (Pareho naman silang masipag, at matiyaga kaya na promote narin sila ng ilang beses.)

Ex 1: Pedro’s Lifestyle

 

So ulitin lang natin, si Pedro ay kumikita ng P50,000.

At buwan-buwan si Pedro ay gumagastos lamang ng P15,000 a month. Nakabudget siya lagi, hindi madalas gumimik, simple lang ang panamit, at maligaya na sa mga ari-arian nya basta gumagana.

So si Pedro ay may Excess Cashflow na P35,000. Ibig sabihin, ang kanyang bank account ay napapalaki nya ng P35,000 kada buwan. Sa loob ng 10 buwan, kaya nyang mag ipon ng P350k.

At sa loob ng 5 taon, pwedeng nang mamuhunan si Pedro ng P2,100,000.

Ex 2: Peter’s Lifestyle

Ngayon si Peter naman ay di hamak na mas sosyal kay Pedro.  Si Peter ang masarap kasama. Nanlilibre kapag hiniritan mo, at pag inaya mo lumabas, game agad. Si Peter ay sumisweldo rin ng P50,000 a month. Big time ang sweldo nya, kaya big time rin siya gumastos. Lahat ng latest nagagawa nya. Kung ano ang in, nandun siya. Yun na ang reputation nya. In na in talaga si Peter, sobrang dami nyang friends and followers at lahat ng pinopost nya sa Instagram, kinaiinggitan ng mga tao. Kaya rin naman buwan buwan ang nagagastos nya ay nasa P45,000. At ang natitira nalang sa kanya ay P5,000.

Itong P5,000 ang excess cashflow din ni Peter. Ibig sabihin. Sa kanyang sampung buwan ng pag t-trabaho, siya ay nakakaipon ng P50,000. At pag lipas ng 5 taon, si Peter ay may pang capital na P300,000.

Who is Wealthier? Pedro or Peter?

Let’s be clear. Peter and Pedro are both earning P50,000 each month. Pareho lang sila ng kita.

Pag dating sa social image naman, di hamak na angat si Peter. Isipin mo nalang na kunwari officemates mo rin sila. Hindi ba mas gugustuhin mo rin na si Peter ang samahan? Mas masaya eh.

Pero pag dating sa excess cashflow, pag dating sa financial status, sino sa tingin nyo ang lamang?

Let’s analyze several situations…

1. Let’s say both of them got into a terrible accident.
And the medical bills reached up to 500,000.

  • Pedro – has saved P2.1 Million. So after paying the bills he still has 1.6 Million left!
  • Peter on the other hand only has P300,000 so he has to borrow the P200,000. He borrows the money from his company, and his friends as well. Ngayon si Peter na ang nanghihiram ng pera kay Pedro.
  • Hindi ko naman sinasabi na sana maaksidente sila, but in case when an emergency happens, it’s better to be financially prepared.

2. Let’s say both of them already want to get married to their girlfriend.
They have to buy the engagement ring, and save up for the wedding.

  • Pedro who has P2.1 Million can immediately buy an engagement ring and get married at the soonest time possible. May budget na eh!
  • Peter who only has 300,000, can also buy an engagement ring, BUT he and his girlfriend would have to delay the wedding because they still need to save money. Syempre bongga kaya ang reputation ni Peter, kaya dapat bonggacious din ang wedding. So they want to have a bigger wedding, but they don’t have the money for it yet.
  • So here I’m not saying that weddings have to cost a lot. But when it comes to the big-things in life… would you want to be able to say to say: “Okay let’s do it! Gawin na natin!” Or be limited to saying… “we can’t afford it yet.” Which would you prefer?

3. Let’s say now that Pedro and Peter now want to quit their jobs and go into business.
They are looking for franchises they want to buy.

  • Pedro again who has P2.1 Million, can look at small service establishments and restaurants like Bayad Center’s, Andoks, a couple of salons, laundromats and many others…
  • Meanwhile, Peter who only has P300,000 is limited to small foodcarts, siomai or drink stands…
  • Now take note, pag dating sa franchising, kadalasan, kapag mas established na ang isang franchise, kapag mas kabisado na ng mother company ang business at mas mataas na ang chance for success, mas mahal na rin ang singil nila for the franchise. Meanwhile yung mga bagong at murang franchise, sila yung hindi pa expert sa bawat aspeto ng negosyo kaya kulang pa sa support, o sa training na nabibigay sa franchisee. Kaya mas mababa rin ang chance for success.
  • So medyo kawawa naman si Peter. Mas konti na nga pera nya, tapos yung mga franchise pa na available sa budget nya, ay yung may mga lower chance of success pa.

The Consequences of the Social Status Trap

 

  • You can end up not being prepared for emergencies.
  • You can end up not having funds for the bigger things in life.
  • You can end up being limited with the business opportunities you can take.

Lahat ito, dahil lang sa maling paniniwala na social status = financial status.

Ito na yung kasabihan:

Kapag ang tao’y puro dating, kadalasan wala itong datung. 

Be aware of the social status trap and avoid it at all costs.

With this I leave you with the following reminder:

Invest in things that will make you rich,
not on things that only make you look
or feel rich.

 

P.S. If you want to learn more about having the right mindset and approach to proper wealth creation, then I invite you to go to www.GameOfWealthOnline.com to get your access to the free online seminar series I created there. That series is much more jam-packed with life changing information. So if you haven’t seen that yet, go to www.GameOfWealthOnline.com to get your free access.

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