Do you find yourself always out of money or worse still in debt? You are not alone. Financial intelligence and financial freedom is the new rave in town but most people who talk about it never put it into practice.
To grow your money, you must first understand how it comes, why it comes and what you must do to keep it coming…never mind the “easy come, easy go” mantra your buddies chant. Managing your money may seem as difficult as rocket science but once you know how to, you can exit the realm of perpetual lack. Here are 5 reasons you are always broke and how to get out.
1. You are a perfectionist
The Problem: You feel creating a budget is not necessary until you have some sort of stable income. Other times, you feel it’s a wrong move and so you make no move at all.
The solution: Start by writing a budget. What are the things you repeatedly spend money on that you cannot do without? Write those down first; those are your needs. When forced into a corner, you can eliminate the lesser items. Remind yourself that an imperfect budget is better than no budget.
2. You do not track your spending
The Problem: Let’s face it, how many people actually track their spending? Your real problem is impulsive buying. I have been guilty of this; I walk into the store to buy a deodorant and walk out with a bag full of things I do not need. Not good honey, not good.
Don’t act like you didn’t do the same thing last week. You even promised you were going to keep track of every naira and you did – for two hours. Now you are so broke you feel like you need bandages.
The Solution: The good old shopping list, tracking apps or a notebook should help you monitor the holes in your financial pocket. Admittedly, it’s a new habit but after 21 days it should be a part of you.
3. Life Happened
The problem: Life happens to everyone, you just have to be prepared for it. From falling in love to falling sick (which we do not wish on anyone), relationships and healthcare is capital intensive. You did not plan to buy a gift for the love of your life but now you have got to show some love and so your money suffers for it.
The Solution: Plan, prepare and brainstorm annual expenses such as birthdays, anniversaries and even occasional seasonal spending. There is nothing wrong with planning for an anniversary that is six months away. It means you wouldn’t be caught by surprise.
4. The “Sales Slash” prompts
The Problem: You think “buy one, get one free” is a good deal until you add up the daily deals. How about data usage, social media apps and streaming your favourite online shows?
The solution: “Do I really need this purchase?” is a question you should ask yourself every time you are tempted to make a purchase online. Another way to avoid impulsive buying is to never save your credit card info on a site. It makes it harder to press the “buy” button and gives you time to really consider if you are about to take a wise decision.
5. You’ve Got ‘Bill Gates’ in Your Blood
The Problem: Your budget is a sacred rule to follow until it comes to your friends, partner or the general public. You have money the public can use. It is a good habit, giving ought to be a habit everyone should practice. However, it must be part of the financial plan too.
The solution: Include it in your budget. If you are a giver, then giving should be an important part of your budget. Just because the gift giving is not for you does not invalidate their counting as expenses.
Once in a while you might veer off “the script” and that’s alright. Alternatively, you can make all the money in the world and become the next Bill Gates but I think even Bill Gates tracks his giving.
Next week, we’ll continue…until then, faya on!