February Update: Emergency Fund Edition

Emergency Pig is from the Economic Times of India. 

Despite my new year's resolution of posting more consistently, I haven't really written any updates for February and it's the last day! 

So here I am sliding into your feed on the last day of the month. I'm tempted to just post bullets of what happened to me since my last post. I might as well call this update the Emergency Fund Edition because I've had unexpected spendings of all sorts. 

1. I have managed to log my expenses for 2 straight months. Last January, I had to fund my mother's travel expenses. Although her friend shouldered most of it (ticket, hotel), I still had to shell out for spending money and other expenses. Add other day to day and regular expenses, this resulted in me using up to 95% of the month's pay overall. 
2. This month, regular expenses tallied up to 65% of my net pay. There's still some pending expenses coming up (like airfare and accommodations) for a professional opportunity that came up. The upcoming training's accommodations will be reimbursed up to a certain amount, so I really looked for places that fit the bill. At the moment, I'm hoping that some upcoming seat sales will allow me to buy tickets that won't break the bank. 
3. Earlier this month, I tried to update my laptop's operating system but something happened and it won't boot properly anymore. I tried to troubleshoot it on my own, but with a deadline and tons of work stuff coming up, I really had to have it fixed. There were places recommended but they were closed for the duration of the holidays--it was Chinese New Year--so I had to go to Greenhills. While the guys who fixed my laptop were okay, I still can't help but feel that I would have gotten the job done for lower if it wasn't an emergency and if the other places were open. Well, tough luck. The repair cost me ~13% of the month's expenses. 
4. Last week, I got bitten by a small animal and had to go to the emergency room to get anti-rabies and anti-tetanus shots. It's a good thing I have a health card. The shots were covered by the HMO. From the ER, I was instructed to go to the Company Billing Window, filled out some forms, waited around to have it approved. Once approved, they sent me to the Pharmacy where I got the meds. I didn't see the exact figure but it was a sliver shy of 3k pesos. Earlier this week, I had to return for the next set of shots. Same process, but this time instead of the ER, I had to go through the regular window. It took some time, but not that long. All in all it was a smooth process. Charge was still less than 3k. But still, I would have preferred not to have to go through it. 
5. I have qualified for substituted filing this year since I really only have one  main source of income now. It's really much simpler to just sign the papers and hand them over to the finance people and have them process it. That's one less errand that's taken care of. 
6. There's still some raket/freelancing money that I can round up. I'm sure the cheques have gone stale, so I will need to request them to reissue it. And it involves going to three different places to collect them. But it sure gives me comfort that there are still some hustle money floating around that can fund the next adventures. 

So I've had three things come up that were unscheduled: ER trip and shots, computer repair, travel expenses. They all cost serious money. It's not so bad. Things happen, and I am looking forward to the trip next month. 

How to Ride the TRAIN with reservations

The gift that keeps on giving. You do you, Alma. 

The first part of the Tax Reform for Acceleration and Inclusion (TRAIN) was signed into law in December of last year. Its main selling point was that those earning Php250k annually will no longer have to pay the income tax. While a lot of people find this a cause for celebration. 

Like Alma Moreno, I still have my own reservations about this whole exercise. I do recognize that we will have a bigger take home pay, but I also know that we will be taxed in other ways. Like the price of anything that uses oil or sugar will surely go up. Hello, fare hikes and no more unli-softdrinks. (Not that I'm a big fan of soda, anyway.) 

But I want to look at this positively, so I want to focus on how the TRAIN will make our take home pay bigger. Every year around tax time, I just grind my teeth at how much tax the government takes away. I mean, it's fine if you see that social services are efficient or that government officials are competent. Just knowing that your tax money goes to someone else's already deep pockets and yours are butas, that's just a major bummer. 

In the pre-TRAIN tax regime, I get taxed ~25-32% because I am single, have no dependents, and earn from multiple compensation. A part timer is only allowed a maximum of 12 hours a week. So if I work for 4.5 hours a day, I only get 3 hours because the 1.5 is already eaten up by taxes. Your payslip may show that you get a sizeable amount, but the reality of what shows up in your ATM is another matter. A third of your salary is no laughing matter. Because in a year, that amount balloons to more than 6 digits. Monthly, it's enough to pay an amortization for a condo or a house. But in reality, I can't even qualify yet for a housing loan--I'm a part timer, and my salary is under 50k. So yes, a bummer. 

Photo courtesy of ABS-CBN reporter Alvin Elchico. 

In the new TRAIN Revised Withholding Tax Table, my income category falls under the 30k + 25% of the excess over 400k. Which means roughly my annual income tax will now fall under 50k, which is a whopping reduction coming from around 3x that amount. From a condo amortization, pambayad na lang ng parking---kung may kotse ako. Eh wala so nganga. Hahaha. 

But seriously, if the tax computation table is indeed true, that is an additional 7k or so to the monthly take home pay. 

What to do with this "free" TRAIN money? 

Not going to spend it on #travelgoals, that's for sure. Will most likely funnel it into a retirement account, aka the long delayed PERA. 

As for which entity and fund, that will come in another post.