Set savings goals, but treat yourself too
Set savings goals, but treat yourself too, says Sconaid McGeachin, general manager and CEO in the Middle East and Turkey for Hill+Knowlton Strategies Qatar LLC
What’s your spending philosophy?
People always spend up to the limits of their salary – but being out here in the UAE, with a tax-free income, you have an opportunity to save more money. You do have the chance to put money away for your future and your retirement. If your from the UK, as time goes on, it becomes less and less likely that you will be able to draw a state pension. Therefore it’s really important to put money aside for that now. There is a lifestyle here that makes it very easy for people to go out and spend, either by socializing or through buying the latest handbags etc. It’s very easy to get sucked into that. But it’s important to have a budget which allows you do to some nice things while you’re living here, but allows you to save as well.
Have you ever been down on your luck financially – and if so, how did you pull yourself out of it?
Previously, my family and I were living in Eastern Europe, and the cost of living was extremely high. Salaries weren’t going up for various reasons and that made things very difficult to actually purchase normal goods. At the same time we had children, so that bought additional expenditure. We found that we really had to adjust our lifestyle to cope with that. We did use credit cards – but only up to a certain amount, and only for certain things. We were determined not to get in over our heads. It’s very easy to do that with credit cards. You can put things on them and then just pay the minimum amount without actually paying the whole thing off.
What’s the biggest challenge facing consumers today?
I think there is so much consumer choice. People want to be seen to be doing well and sometimes, how you dress, how you look, the type of car you drive is all seen to be part of having a successful lifestyle, particularly here in the Middle East. It can lead you into spending more than you ideally want to. The biggest challenge therefore is really trying to stay true to your own beliefs and values – rather than being lured into that ‘keeping up with the Jones’s’ as they say.
What’s your opinion on the credit crunch and the recent upturn?
I think there has been caution in the Middle East since 2008 – it has been a reality check. I think it has helped people realize that the good times might not be there forever and therefore you need to take sensible stock of your finances from the start, rather than thinking ‘I’ll just spend for a couple of years before I start to save for my future.’ I think clearly nobody wants to get into debt here, due to the strict laws, and we’ve all learned something from that experience.
What’s been your biggest financial achievement?
I think the biggest thing has been setting aside money for our two children. We’re determined to set aside money so that they can go to university. Now, tuition fees, whether they go to university in the UK, or abroad, are substantial and are getting higher. Whilst our daughters might take on a summer job to fund themselves partly, we would like to be able to help as much as possible so that they can get a great education, and get the job they want at the end of that. Education in the Middle East too is extremely expensive. School fees seem to be going up more regularly. From my point of view, the standard of schooling is very good here so I’m happy to pay for it. But it is also a big investment.
How do you keep yourself inspired and motivated when it comes to savings and budgeting?
I think we just look at setting ourselves targets. We have savings goals that we want to reach, but we also allow ourselves treats from time to time. From my point of view, we all need to have treats. And enjoy life at the same time. There’s no point in squirreling everything away and then not being able to enjoy your money because something unforeseen happens. It’s all about balance and giving yourself little incentives as well as making sure you reach those essential savings targets too.