Day#6: Identify Employment Benefits

Posted by FrugalPinoy on Nov 25, 2009 in 25 Days to Healthier Finances, Financial Tips | 4 comments

Today’s Task: Find out what your employment benefits are.

Most prospective employees often ask about the benefits before they accept a job offer. Not everyone knows the exact details of their employee benefits, however, so you may be overlooking something. It’s best to find out the exact benefits you’re entitled to. Here are some that you might already have:

• Overtime pay
• 13th month pay
• Food, clothing, and transportation allowances
• Medical and dental plans
• Expense accounts
• Allotted rest days
• Paid vacation leave and sick leave
• Lower interest rates on certain loans
• Any product discounts/freebies from the company or its affiliates (such as gym memberships, etc.)

Also, check this list of mandatory employee benefits in the Philippines and see if your employer covers them all.

Apart from the benefits themselves, find out if any relatives or other dependents are covered for some of them. This is usually true of medical benefits.

So that’s our task for today. Find out your exact employee benefits and write them down. That’s the only way you can maximize them.

(Since I’m self-employed this doesn’t really apply to me, but for some of my contracts I’m allowed to get reimbursements for any extra expenses I incur that’s related to my work. So I suppose my task is to find out the exact amount and what types of expenses are covered.)

When listening to experts, use your brain

Posted by FrugalPinoy on Mar 27, 2009 in Consumer habits, Financial Tips | 0 comments

Did you know that whenever you’re receiving advice from an “expert” (real or otherwise), it’s likely that you’ve turned off your own ability to make decisions?

According to a recent study, research participants were asked to choose between receiving a sure amount of money or gambling on a riskier, yet higher paying lottery. Scans showed that the participants were activating the brain circuits that weighed risk vs. reward.

But, when an “expert” (actually a computer program) offered his advice, those brain circuits showed no activity. This means that when faced with seemingly expert opinion, our natural tendency is to stop weighing the decision ourselves.

“Most average people have this tendency to turn off their own capacity for making judgments when an expert comes into the picture,” says Gregory Berns, a neuroeconomist at Emory University in Atlanta.
Source: “Brain quirk could help explain financial crisis”, NewScientist.com

While I don’t think that this is solely to blame for the financial crisis, it explains why some people would make risky decisions without thinking twice about it.

So how do we prevent ourselves from relying too much on experts and making blind financial decisions? We need to do the research. In a previous post, I talked about how I only invest in things I understand well. If I don’t understand something yet I want to invest in it, I do the legwork and conduct research from multiple sources. I try to gain an above-average understanding about it. True, this limits the amount of things I can invest in, but at least I know what I’m doing and I don’t lose my money. Or my head.

With that said, I’d like to remind everyone that although I give advice here at Frugal Pinoy, I’ve always been an advocate of doing your own research. If you go back and read my previous posts, I always phrase my advice this way “…this is a personal choice for me, but do what’s right for you…” or “it depends on the situation”. I do this because I know that we all have different habits, priorities, and needs.

Don’t listen to anyone’s advice blindly – even mine. Because you should be the prime expert of your own finances.

Image by Sophie from sxc.hu