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NOTES: BUILDING AND ENHANCING NEW LITERACIES ACROSS CURRICULUM
Literacy
 is critical in helping us make sense of our world. From the time we wake up to the time we go to sleep, we are constantly making
meaning of the world around us.
 has traditionally been thought of as reading and writing. Although these are essential components of literacy, today our
understanding of literacy encompasses much more.
 Alberta Education defines literacy as the ability, confidence and willingness to engage with language to acquire, construct
and communicate meaning in all aspects of daily living. Language is explained as a socially and culturally constructed
system of communication.
 Literacy is usually defined as the ability to read, write, and do math.
MILLER (1973) divides concept of literacy into three sub-categories:
Basic literacy has been popularly defined as form of abilities to read, write, and do basic arithmetic or numeracy. Barton (2006)
asserts that the notion of basic literacy is used for the initial learning of reading and writing which.
Comprehension is the understanding and interpretation of what is read. To be able to accurately understand written material, children
need to be able to (1) decode what they read; (2) make connections between what they read and what they already know; and (3) think
deeply about what they have read.
Functional literacy refers to the practical skill set needed to read, write, and do math for real-life purposes, so people can function
effectively in their community. This definition comes from the United National Educational, Scientific and Cultural Organization, or
UNESCO, an international agency that researches education, science, and communication.
o The Arts and Creativity
This literacy can be manifested in creative ways of problem-solving and expressed through the production of various art works.
Teachers and students need to be more adept in the arts and manifest creativity in various activities.
o Ecoliteracy
This entails acquiring knowledge about climate change, pollution, loss of natural habitats and biodiversity as well as the impacts
of environmental problems on human lives. Moreover, solutions on how these environmental problems could be addressed
must also be practiced. Teachers and students need to develop awareness of the environment.
o Cyberliteracy/Digital Literacy (Information and ICT Knowledge)
This competency is based on the reality that societies and workplaces have now become more information-driven. Workplaces
of the 21st century rely heavily on electronic (digital) forms of data storage and management as well as in the area of
communications. Teachers and students need to develop familiarity and skills in the use of computers, the internet and other
information technologies.
o Financial Literacy
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Teachers and students are expected to be knowledgeable about the basics of economics and financial management. This way,
you as a teacher, can extend the skill into livelihood activities, entrepreneurship, and wise handling of personal finances.
o Media Literacy
Teachers and students are expected to be knowledgeable and skilled in the area of communications particularly the media.
Teachers and students must learn how to discern news and information based on the form and content as to how this
information are transmitted via various forms of media.
o Social/Emotional Literacies
You and your students need to acquire social skills that are attuned to the norms of your current society. Emotional intelligence
must also be developed to be able to effectively manage the stresses of a fast-paced 21st century society.
o Globalization and Multicultural Literacy
You and your students need to develop a culture of respect for cultural diversity. There is value in having a perspective as a
global citizen whose local actions can have an impact on the wider global arena. You also have to understand how world events
may also affect you and your community at the local level
GLOBALIZATION
o Is the process of interaction and integration between people, business ethics, governments, and cultures from other nations,
driven by international trade and investment and supported by information technology (Levin Institute, 2017)?
o Globalization as phenomenon is not new.
o What is different now, however, is the speed at which globalization happening, its overall scope, and its effects on the lives of
ordinary people.
EFFECTS OF GLOBALIZATION
Meyer (2000) summarizes the effects of globalization as follows:
1.
2.
3.
4.
5.
Economic dependence/interdependence
Political dependence/interdependence
Military dependence and interdependence between nations
Expanded flow of expressive and instrumental culture
Expanded flow of people among societies
POSITIVE EFFECTS
While Philippines society has come to realize that this early perspective represented a shallow understanding of globalization, the fact
of the matter is that:
 Globalization has brought economic development to our society as a whole.
 attracting Foreign Direct Investment (FDI)
NEGATIVE EFFECTS
Kentor (2001) notes that foreign capital dependence increases income inequality in four ways:
1. It creates a small, highly paid class of elites to manage these investments, who create many but usually low-pay jobs
2. Profits from these investments are repatriated, rather than invested in the host country, therefore inhibiting domestic capital
information;
3. Foreign capital penetration tends to concentrate land ownership among the very rich; and
4. Host countries tend to create political and economic climates favorable, to foreign capital that in turn limit domestic labor’s ability
to obtain better wages in simple words, “the rich become richer, and the poor become poorer
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Hout (1980) observes that international dependence (another word for globalization) tends to suppress adult wages, which in turn
perpetuates the role of children as economic necessities (the familiar saying:
“Kapag maraming anak, maraming katulong sa hanapbuhay” leading to explosive population growth.
Political and Military Interdependence and Dependence
A survey conducted in late 2018 found that three in five Filipinos believe that the United States would intervene on behalf of the country
in case of war (Viray, 2018)
Expanded Flow of Expressive and Instrumental Culture
Expressive Culture - As the term suggests, deals, with how a particular culture expresses itself in its language, music, arts, and the
like. Globalization encourages the monetization of these cultural artifacts and their import/export among participating cultures; the
increased consumption of which changes the consuming culture.
Instrumental Culture - On the other hand, refers to “common models of social order” (Meyer, 2000) – that is, models or ways of
thinking about and enacting national identity, nationstate policies both domestic and foreign, socioeconomic development, human rights,
education and social progress.
Expanded Flow of People Among Societies
The fact that globalization encourages the movement of people between nation-states should come as no surprise to us. The Philippine
Statistics Authority (PSA) estimates that there were 2.3 million Overseas Filipino Workers (OFW's) during the period of April to
September 2017, who were responsible for up to 205.2 billion in remittances (The Philippine Statistics Authority, 2018).
Meyer (2000) observes 3 reasons for this: socio-economic migration, political expulsion and travel/tourism.
 Socio-economic migration explains:
The Philippines’ OFW phenomenon
Find better economic opportunities
 Political Expulsion
Trying to escape the political climate of a particular country
 Travel/Tourism
Travel for the sake of leisure (i.e., tourism)
CULTURAL LITERACY
A term coined by Hirsch (1983), referring to the ability to:
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understand the signs and symbols of a given culture
able to participate it its activities and customs as opposed to simply being a passive (and outside) observer.
The classroom was in absolute "bedlam"
CULTURAL LITERACY IN THE PHILIPPINES
The National Commission for Culture and the Arts (NCCA) is the government body tasked with the documentation, preservation and
dissemination of Philippine culture, both locally and abroad. Part of how the NCAA is addressing this and related matters is through the
establishment of the Philippine Cultural Education Program (PCEP), which "envisions a nation of culturally literate and empowered
Filipinos" (NCCA, 2015).
ACT 10066 (2010)
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CULTURAL EDUCATION AND THUS CULTURAL LITERACY IN THE PHILIPPINES
 is quite a challenge, given that Philippine culture is a complex blend of many indigenous and colonial cultures and varies widely
across regions, and the average citizen is almost as ignorant of other Philippine cultures as foreigners are? To point out. consider
the question. "What makes something or someone "Filipino?"
DE LEON (2011)
coins this propensity for Filipinos to look at their culture and themselves through Westem lenses as the Doña Victorina Syndrome:
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a kind of inferiority complex wherein anything and everything natively Filipino is considered by the Filipinos themselves as being
inferior, backward, and worthless in comparison to other nationality.
Biggest Challenge
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the deconstruction of the negative self-images and notions of ourselves that we have imbibed over generations through "a
workable, effective program of education that can make Filipinos more responsive and sensitive to Filipino dignity, needs,
values, and cultural potentials and assets."
CHALLENGES FOR CULTURAL LITERACY IN THE PHILIPPINES
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As Applebee (1987) observes, interesting discussions on cultural literacy give rise to some very difficult questions which are
particularly important to a multicultural and multilingual nation like the Philippines.
What kinds of knowledge constitute cultural literacy? Is it knowing facts, names, and dates, or is it something more experiential
like being familiar with a story or a particular song?
If culture is more "caught than taught, " should cultural literacy be one of the goals of education? If yes, how does one teach it?
Whose cultures must we be literate in to be considered "cultural literate"? Who decides which cultures are included and which
one are excluded and on what bases?
Is cultural literacy education simply a means for the dominant cultures to express its dominance over minority cultures?
How is cultural literacy to be assessed and evaluated to these questions exist in the literature?
MULTICULTURAL LITERACY
 as a set of skills and knowledge is difficult to define because of how it changes depending on the contexts in which it is
discussed. For example, multicultural literacy as defined in American literature is different from how it is deployed in more
European context.
 In American, multicultural literacy has very strong learnings toward knowing or identifying the poly-ethnic origins of knowledge
with the express goal of fostering equality, diversity, and social justice. This is in direct response to the “Euro-centric” and
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“white-dominant” traditions of education that in the eyes of American cultural minorities (particularly the blacks) is a form of
racial injustice.
Meanwhile, in Europe, multicultural literacy comes more in the form of intercultural communication competence (ICC), which is
defined by Dusi, Messetti, and Steinbach (2014) as a composite of skills, abilities, attitudes, personality patterns, etc. Necessary
for clear and productive communication with cultures other than our own. Similarly, Fantini (2006) defines it as “a complex of
abilities needed to perform effectively and appropriately when interacting with others who are linguistically and culturally
different from oneself”.
We define multicultural literacy here as a knowledge and skills necessary to ensure that any communication with a culture
different from our own is clear, productive and respectful such that their differences are celebrated and neither culture is
demeaned or treated as interior.
It is important to realize that under this definition a "different culture" is not just limited to "someone from another country" but
could also include someone whose gender, economic background, religious beliefs, sexual orientation or even sense of fashion
is different from our own.
The skills and knowledge required for one to be multiculturally literate are not mere language skills, since it is assumed that
some medium of communication already exists between two cultures. Rather, true multicultural literacy consists of perspectives,
attitudes and beliefs about other cultures that affect the manner in which we communicate and the motives behind the
communication. Here are some examples:
 Be selfless
 Know that good and useful things can (and do) come from those different from us
 Be willing to compensate
 Accept that there are limits
CONFLICTING REQUIREMENTS FOR PEACE
 When all is said and done, the heart of multicultural literacy is peace among different cultures-that is, productive and non-violent
interaction. It is easy to assume that all cultures value peace to the same degree and are therefore willing to make the same
compromises in order to attain it, but this is not necessarily true.
 Take for example the Israeli/Palestinian conflict, which is really a conflict over territory: Both sides desire peace, but they do
not desire it enough to be willing to compromise, in a very real sense, both sides would rather live in perpetual conflict with one
another rather than give-up their claim to the land which each side believes is rightfully theirs.
NATIONALISTIC AND REGIONALISTIC PUSHBACK
 The increasing demand for multicultural sensitivity, inclusion, and diversity in the recent years has also given rise to resistance
from groups who believe that their identity is being "watered-down" by the needed compromises.
Ortograpiya ti Pagsasao nga Ilokano by officials of the Komisyon ng wikang Filipino (0ctober, 2018)
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intense backlash
incompetence in preparing the Ilokano orthography being used by the Ilokano writers and experts.
Dumlao (2018) stated that National economy Ortograpiya ti Pagsasao nga Ilokano by officials of the Komisyon ng wikang Filipino would
destroy the identity of the Ilokano language based on the standard of Ortograpiyang Pambansa.
 We see here that while multicultural is by and large a good thing it comes at a cost. Part of the identity of the host culture
becomes diluted and lost-the inevitable result of the compromises necessary for it to have some form of multicultural
understanding. In effect, pushing for multicultural inclusion might very well be asking some cultures to decide which has more
value inclusion or identity?
THE PERSISTENCE OF THE PROBLEM
 We see here that while multicultural is by and large a good thing it comes at a cost. Part of the identity of the host culture
becomes diluted and lost-the inevitable result of the compromises necessary for it to have some form of multicultural
understanding. In effect, pushing for multicultural inclusion might very well be asking some cultures to decide which has more
value inclusion or identity?
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 Therefore, the primary issue that educators face in teaching multicultural literacy to their students and learning it for themselves
is. "Why does this problem persist?" Or to put it in another way. "Despite all out advances in science technology, and culture,
why is this still a problem today?"
 Boutte (2008) suggests that issues of discrimination in all its forms (racial, religious, tribal, cultural, etc.) are really issues of
hatred, which she defines in an educational setting as "the lack of compassion and lack of respect for the rights of others, " and
that such hatred must be fought and its roots must be attacked, because for as long as hatred exists in the human mind, real
peace will be impossible (Vreeland, 2001).
The Question of Value
 Why should I treat people of another culture with respect?
 Why should I value another culture, another society, another person more than myself and my own?
 A majority of research on multicultural literacy stems from the West, specifically the United States, and focuses on teaching
teachers to be more multicultural in their pedagogies.
 Learn about other cultures. Banks (1991 a)
 posits that the first step to teaching multiculturalism is knowing about cultures that are not your own. It follows that if you, the
teacher, know only your own culture, then you will be unable to teach your students to appreciate a culture that is different from
your own.
 Familiarize yourself with how discrimination and prejudice appear in your own culture.
 Boutte (2008) and Banks (1991b) agree that teachers must be able to identify and confront patterns of discrimination and
prejudice in their own lives before they can teach their students to do the same.
 As you are, so will you behave.
 Key to genuine multicultural literacy is core values-that is, what you, the teacher, really believe about people who are different
from you: not the kind of belief that you can just say you possess when talking to your class, but the kind that determines your
behavior when you think no one is watching
SOCIAL LITERACY
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Concerns itself with the development of social skills, knowledge and positive human values that enable human beings to act
positively and responsibly in range of complex social settings.
It is the knowledge of how to behave and treat other people in a way that is morally upright, just and equitable.
DESCRIPTIONS:
MORALLY UPRIGHT
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Thoughts, speech, actions, and motivations that adhere to a standard of right and wrong.
EQUITABLE
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Speech, actions, behaviors, and decisions that treat others fairly, regardless of background or circumstances.
JUSTICE
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System that promotes and rewards good at the same time punishes wrongdoing.
SOCIAL LITERACY (ARTHUR, DAVISON, & STOW, 2000)
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Peers and schools play a formative role on the social skills development of children.
These social skills are often expressed as consisting of three inter-related components: social perception, social cognition and
social performance
Social skill is defined in literature as the ‘ability to interact with the others in a given social context in specific ways that are socially
acceptable or valued and at the same time personally beneficial, mutually beneficial, or primarily beneficial to others’
 These range from the ability to initiate, maintain, and end a conversation to reading social signals to more complex skills such
as solving problems and resolving conflict. (Lawson, 2003)
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 Children with social skills deficits can be taught these skills directly to parents, teachers, and/or professionals using the
strategies of modeling, role-playing, rehearsal, and practice.
SOME OF THE FUNDAMENTAL PRINCIPLES OF RELATING WELL TO OTHERS
Greeting
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The first step in a social interaction is greeting someone.
Greeting others is done not only with words like “Hi!” or “How are you?” but with facial expressions, tone of voice, and gestures
such as a nod or a wave.
Nonverbal part of greeting someone is just as important as the words.
Initiating Conversation
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In order to carry on a conversation, a child must be able to initiate, maintain and close conversation appropriately.
Requires good listening and attention skills.
Being a good conversationalist requires turn-taking and reciprocity.
Understanding the Listener
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Once the conversation is initiated, it has to be maintained.
It is important to understand the audience one is talking to.
A misread of the listener often leads to a misunderstood message and potential social rejection.
Empathizing
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Empathy is more than perspective taking: it means that one is able to feel what the other person feels.
Reading Social Cues
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Cues are hints and signals that guide us to the next thing to say or do.
Social cues can be verbal or nonverbal.
Good detectives pay very close attention to nonverbal cues.
Previewing or Planning
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Conversation also require that one previews or thinks about what effect the words or actions may have on the listener before
she says or does them.
If the impact will be negative, one can adjust what she might say or do.
Problem-Solving
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Problems and conflicts are often a part of social interactions.
How one reacts to these conflicts depends on how good his/her problem-solving skills are.
Turning a conflict from a “win-lose” situation to a “win-win” situation is the best way to resolve conflict.
Requires negotiation and compromise, give and take those results in a situation.
Apologizing
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A person with good social skills is confident enough to make a sincere apology for his/her error.
This is a courageous act and is the quickest and easiest way to correct a social blunder.
Apologizing is a sign of humble and mature character when one commits mistakes.
ROLES OF PARENTS AND TEACHERS IN TEACHING SOCIAL SKILLS TO CHILDREN
PARENTS
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 Typically play the major role in teaching children’s social skills.
 Can directly teach social skills by modelling, role-playing, and providing opportunities for their child to rehearse and practice
new skills.
PROFESSIONALS
 Typically intervene only when children are having substantial social difficulty with peers.
 Can implement structured, guided, and effective programs that often involve groupwork with peers.
 In school, teachers do not have to teach a class in social sills, they can advantage of every opportunity to help children improve
their social skills.
 Teachers should be alert to teasing and bullying and aware of children that are rejected or ignored by their peers.
 Teachers should work cooperatively with the children’s parents to prevent humiliation, embarrassment, and distress that befall
these children.
ISSUES IN TEACHING SOCIAL LITERACY
 How children develop their social literacy is intrinsically a contextual matter and is not something that can be easily traced in a
linear or developmental fashion.
 Children learn through social practices, both explicit and implicit, and become human through social interaction.
 Children are disposed to be social before they learn what sociability is all about
 Teaching social literacy in schools is not easy as it appears to be due to subjective standards of morality and inherent human
capacity to judge and make excuses.
DISTINCT WAYS OF ANSWERING THE QUESTION ON HOW CHILDREN LEARN TO LIVE SOCIALLY WITH EACH
OTHER AND WITH ADULTS
Normative and Communal
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From their culture, children learn customs that provide them with guide to act in ways that minimize conflict.
Pragmatic and Individualistic
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The social order of children is created by explicit and implicit agreements entered into by self-seeking individuals to avert the
worst consequences of their selfish instincts (Arthur, Davison, & Stow, 2000)
ISSUES
Subjective Standards of Morality
 The natural outcome of postmodern philosophies is that truth and morality are considered subjective and open to individual
interpretation.
 When the standard of measure between good and bad changes, this gives us license to change as well and opens the gates
to all kinds of abuse.
 In effect, pulls the rug out from under any and all attempts at true justice and equitability, since they themselves rely on a
fixed moral standard.
Human Nature
 While we would all like to believe that people are inherently good, experience has taught us that the inherent goodness of
humanity is, at best, unreliable: Sometimes it is there, often it is not.
 We insist that others be judged according to a fixed moral standard, but invoke a subject one when our own behavior is
questioned.
 We insist that others treat us equitably, but are reluctant when treating others with equity costs more than we expected
 Blake (2017) offers helpful reminders to young professionals in terms of social skills in the modern age.
 This situation underscores the importance of educating students in what could be called social literacy to ensure their
academic and career success.
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Situational Awareness in the Workplace
 Require more formal dress and behavior to demonstrate a level of respect.
 Stories prevail of young adults showing up to interviews in casual clothing, texting, or using phones during job interviews or
even bringing their parents with them.
 Lack of situational awareness about what is appropriate to do in different social circumstances
 Students need to be taught what is socially acceptable in terms of dress or behavior for them to stand out above their colleagues.
 An ability to read social situations illustrates strength to employers-quickly picking up on a client’s mood or expectations in
various business or cross-cultural situations can be the difference between success and failure.
Social Intelligence in Technological Communication
 Text-speak and technology use have affected many young people’s ability to communicate.
 Email has deformalized much of the communication process, students still need to ensure their writing denotes respect and
provides enough context for professors to readily respond.
 Text-speak has reduced students’ ability to communicate using correct grammar.
Social Intelligence in Traditional Communication
 While email has taken over as the primary method of communication, traditional modes of discourse still exist.
 An ability to craft these types of documents illustrates an understanding of social expectations and denotes a level of respect
or appreciation.
FINANCIAL LITERACY
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Financial literacy is the ability to understand how money works: how someone makes, manages and invests it, and also
expends it (especially when one donates to charity) to help others.
The National Endowment for Financial Education defines financial literacy as "the ability to read, analyze, manage, and
communicate about the personal financial conditions that affect material well-being. It includes the ability to discern financial
choices, discuss money and financial issues without (or despite) discomfort, plan for future, and respond competently to life
events that affect every day financial decisions, including events in the general economy" (Incharge Education Foundation,
2017).
In addition, Mandell (2009), stated that it's the ability to use knowledge and skills to manage one's financial resources
effectively for lifetime financial security.
Hastings, et al. (2013) refers to financial literacy as:
1. Knowledge of financial products (e. g., a stick vs. a bond, fixed vs. adjustable-rate mortgage);
2. Knowledge of financial concepts (e. g., inflation, compounding, diversification, credit scores);
3. Having the mathematical skills or numeracy necessary for effective financial decision making; and
4. Being engaged in certain activities such as financial planning.
Standards
Earning
Income
Buying Goods
and Services
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Key Concepts
Income earned or received by people
Different types of jobs as well as different forms of income received or earned
Government programs that affect income
Types of income and taxes
Labor market
Scarcity, choice, opportunity cost
Comparing the costs and benefits of spending decisions
Basics budgeting and planning
Making a spending decision
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Saving
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Using Credit
Financial
Investing
Protecting and
Insuring
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Payment methods, costs, benefits of each
Budgeting and classification of expenses
Satisfaction, determinants of demand, costs of information search, choice of
product durability
The role of government and other institutions in providing information for
consumers
Concept of saving and interest
How people save money, where people can save money, and why people
save money The role of financial institutions plays as intermediaries between
savers and borrowers
The role of government agencies such as Federal Deposit Insurance
Corporation (FDIC) plan in protecting the savings deposits
Role of markets in determining interest rates
The mathematics of saving
The power of compound interest
Real versus nominal interest rates
Financial regulators
The factors determining the value of a person’s savings over time
Saving for retirement
Concept of credit and cost of using credit
Why people use credit and the sources of credit
Why interest rates vary across borrowers
Basic calculations related to borrowing (principal interest, compound interest)
Credit reports and credit scores
Behaviors that contribute to strong credit reports and scores
Impact of credit reports and scores on consumers
Consumer protection laws
Concept of financial investment
Variety of possible financial investments
Calculate rates of return
Relevance and calculation of real and atter-tax rates of return
How markets cause rates of return to change in response to variation in risk
and maturity
How diversification can reduce risk
How financial markets react to changes in market conditions and information
Concept of financial risk and loss
Insurance (transfer of risk through risk pooling)
Managing risk
Identity theft
Life insurance products
How to protect oneself against identity theft
BENEFITS OF FINANCIAL LITERACY
 One’s level of financial literacy affects one’s quality of life significantly. It determines one’s ability to provide basic needs,
attitude toward money and investment, as well as one’s contribution to the community. Financial literacy enables people to
understand and apply knowledge and skills to achieve a lifestyle that is financially balanced, sustainable, ethical and
responsible.
 Increased personal literacy affects one’s financial behavior. These changes in behavior pay dividends to society as well. People
who work, spend, save, borrow, invest, and manage risk wisely are less likely to require a government rescue. Financial literacy
does not totally eliminate the need for social safety net because even the most prudent individual can encounter financial
difficulties. But taking responsibility for one’s financial life cultivate proper decision-making skills and discipline. Most of the
responsibility for managing financial matters rests with the individual. That responsibility is easier for adults to bear when they
have learned the basics of personal finance in their youth.
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Financial literacy in the Philippines
 In the article, “State of Financial Education in the Philippines,” Go (2017) indicated several findings with regard to the state of
the country’s financial literacy which include:
 World Bank study in 2014 estimated 20 million Filipinos saved money but only half had bank accounts.
 Asian Development Bank (ADB) in 2015 revealed that PH does not have a national strategy for financial education and literacy.
 In 2015, the Bangko Sentral ng Pilipinas (BSP) released the national strategy for financial inclusion, stating while institutions
strive to broaden financial services, financial literacy should also complement such initiatives.
 As per Standards & Poor’s (S&P) Ratings services survey last year, only 25% of the Filipinos are financially literate. About 75
million Filipinos Ed 110- Building and Enhancing New Literacies Across the Curriculum 16 have no idea about inflation, risk
diversification, insurance compound interest and bank savings.
 Ten years after discovery of the stock market, still less than one percent of PH population invested in it.
 More than 80% of the working middle class have no formal financial plan.
Developing personal financial literacy
There are six major characteristics on how people view money (Incharge, 2017).
 Frugal. They seek financial security by living below their means and saving money. They rarely buy luxurious items; they same
money instead.
 Pleasure. They use money to bring pleasure to themselves and others. They are more likely to spend than to save. They often
live beyond their means and spend more than they earn.
 Status. Some people use to express their social status. They like to purchase and show off their branded items.
 Indifference. Some place vey little importance on having money and would rather grow their own food and craft their own
clothes.
 Powerful. Use money to express power or control over others.
 Self-worth. People who spend money for self-worth value how much they accumulate and tend to judge others based on the
amount of money
Spending Patterns
Are you prudent or have you been accused of spending money lavishly? Or are you somewhere in between? Individuals
have different spending patterns. Before one can come up with a financial improvement plan, one needs to analyze his/her
spending habits. There are two common spending patterns:
 Habitual Spending – occurs when one spends out of a habit, when one buys the same item daily, weekly, or
monthly. Daily items may include water, rice and cup of coffee. Week items may be grocery items. Monthly items are
electricity and internet bills.
 Impulsive Spending – occurs when one mindlessly purchases items that he or she does not need. Many people
are often enticed by monthly sales at the malls with the attitude that they may lose the items the following day.
Fixed vs. Variable Expenses
Fixed expenses remain the same year-round. Car payment is an example. Variable expenses occur regularly but the amount you pay
varies. Electric and gas bills are example of these.
Needs vs. Wants
Financial discipline starts with an ability to recognize whether expenses are needs or wants and followed by ability to prioritize needs
over wants. Needs are essential to our survival. Wants are things that you would like to have but you can live without such as new
clothes, or a new cell phone model. You want them but do not necessarily need them. Too many wants can ruin a budget.
SETTING FINANCIAL GOALS
 Setting short-term, mid-term, and long-term financial goals is an important step toward becoming financially secure.
If you aren’t working toward anything specific, you’re likely to spend more than you should. You’ll then come up short when you
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need money for unexpected bills, not to mention when you want to retire. You might get stuck in a vicious cycle of credit card
debt and feel like you never have enough cash to get properly insured, leaving you more vulnerable than you need to be to
handle some of life’s major risks.
DEVELOPING A SPENDING PLAN
 Putting your financial goals in writing can make them more concrete and achievable. However, it's easy for everyday
purchases and obligations to get in the way of saving for the future. One of the best ways to make sure your daily spending
habits don't overwhelm your life goals is to create a spending plan. A spending plan is not meant to be a strict budget. Instead,
it's a guide that will help you take control of your financial future and, ultimately, reach your goals.
Time and effort are necessary to build a sustainable spending plan. Three easy steps are proposed below when developing your
personal spending plan:
1. RECORD – Keep a record of what you spend
2. REVIEW – Analyze the information and decide what you do.
3. TAKE ACTION – do something about what you have written down.
IMPORTANCE OF SAVING
Because no one can predict the future with certainty, we need to save money for anything that might happen. Here are some reasons
swhy saving is important:
Emergency Bolster – you should save money to avoid going to debt just to pay emergency situations like unexpected
medical expenses and damages caused by calamities and accidents.
Retirement – you will need savings/investments to take the place of income you will no longer receive when you retire.
Future Events – you need to save for future events like weddings, birthdays, anniversaries, and travels so as not to sacrifice
your fixed expenses.
Instability of Social Security – pensions from social security should only serve as supplementary and not the primary
source of income after retirement.
A Little Goes Along Way – small consistent savings go a long way.
There are two (2) ways to save:
1. Save before you spend; and
2. Save after you spend wisely.
In order to stick to the savings habit, you should:
1.
2.
3.
4.
5.
Commit to a month
Find an accountability partner
Find a savings role model who is successful with his/her money, through tried-and-true savings
Write your goal down and track it
Avoid tempting situations (don’t go to mall to “hang out”)
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