Jakarta, CNBC Indonesia – In 2023, Several research institutions in Indonesia have informed that the capital required to become a legislative candidate is indeed quite large. And specifically for the DPR RI, the value reaches billions of Rupiah.

As is known, LPM UI states that capital to become a legislative candidate reaches:

Candidates for DPR RI members: IDR 1.15 billion – IDR 4.6 billion
Provincial DPRD member candidates: IDR 250 million – IDR 500 million

Meanwhile, Prajna Research Indonesia has also conducted research on capital to become a legislative candidate. Here are the details:

Candidates for DPR RI members: IDR 1 billion – IDR 2 billion.
Provincial DPRD member candidates: IDR 500 million – IDR 1 billion
Regency/city DPRD member candidates: IDR 250 million – IDR 300 million

Legislative candidate capital is used for various things, one of which is accommodation in the electoral district. During the campaign period, legislative candidates visit their electoral districts at least twice a month. During these activities, legislative candidates will incur a lot of costs for transportation, lodging, food, etc., the amount of which may exceed the initial plan.

It is not impossible, the costs incurred could exceed the estimates above or reach tens of billions. And news about borrowing money to run for legislative elections has also circulated in the mass media.

The next question is, is it true that the legislative candidate in question failed in this process, and his family’s finances became a mess?What can be done to prevent this problem?

The answer is a financial health check. Here are the steps you can take first, to check your financial health.

Amount of debt installments

If you have debt, it should be the first to be examined carefully.

The larger the debt installments, the heavier the burden on your expenses each month. And that can make it difficult for you to save or invest.

It would be better to keep the installment amount so that it does not exceed 30% of income.

The amount of outstanding debt

Not just installments, the amount of debt must also be maintained properly. Carry out a careful calculation of the total outstanding debt to date.

If the value of the total debt is still below 50% of total assets, then this amount can still be considered reasonable. But if it’s above it, you have to be alert.

Cash flow health

Find out what expenses have the greatest value and try to find out whether in that time period your expenses exceed your income.

If your expenses exceed your income, then the consequence you have to face is a reduction in the total savings in your account.

Healthy cash flow is characterized by a surplus resulting from a reduction in total income and expenses, which amounts to 10% of income.

Net worth

Net worth is your real wealth or actual wealth. The net worth value is obtained from the reduction of assets and debts.

As long as your net worth is positive, whatever the amount, your net worth is considered healthy. However, if it is negative, it indicates that you have taken on too much consumer debt, and you will be declared to be on the verge of bankruptcy.

Total current assets

Current assets, namely cash and cash equivalents, show the amount of savings you currently have. To determine whether your current assets are healthy or not, you can add up all the money you have and divide it by your net worth.

The ideal current assets are around 15-20% of net assets. Storing too many current assets is certainly not good, because the value of money will be eroded by inflation.

When there is negative cash flow, your current assets will decrease.

Emergency fund amount

The emergency fund value is obtained from current assets in the form of cash and savings divided by total expenses in a month.

The quotient indicates how long you can survive if your income is lost.

For single employees, a score of three is the ideal score. However, for those who already have dependents, the minimum value is six.

Number of investment assets

Have you made any investments so far? Or did you even buy some new investment assets?

To find out your ideal investment amount, you can add up all the investment assets you own, such as gold, mutual funds, shares, bonds, property assets and others. After that, the total value of investment assets can be divided directly by the total asset value.

The minimum investment assets are 50% of total assets, the higher it indicates that the better you are at multiplying your wealth.

Repair according to priority

It takes a plan to improve personal finances. Therefore, do it according to priority.

If you have a pile of debt, there’s no harm in paying off some of it with emergency funds. Or if you don’t have an emergency fund, don’t hesitate to use some of your assets such as investment assets or assets to get fresh money.

Try not to increase debt to meet your living needs if you yourself are a person with an unstable income.

[Gambas:Video CNBC]

(aak/aak)