Love it or hate it, the truth of the matter is that we need money to survive and get around in the world. However with so many thought processes and emotions attached to money, it is easy to begin feeling overwhelmed by finances. Often people fall victim to using money to medicate problems, heal self-esteem issues, and cover up for their lack of presence in a person’s life.
Whatever the case may be, money can be a daunting subject if we don’t approach it with some level of planning and strategy. If thought about correctly, you don’t have to live from one payday to the next in a state of dread as to whether you can make your bills or not.
If you want money in your account for retirement, the cash to open up your own business or funds enough to go for that holiday, it doesn’t happen overnight and it doesn’t happen by accident.
Starting today you can devote a little more time to saving and financial planning. Here are some tips to help you get started.
Personal finance basics
1. Honour your budget
Easier said than done, I hear you say. True enough. But in all honesty, begin with the question…
“Have I ever created a budget?”
If you have never in your life taken a few minutes to write down a budget, don’t knock it until you’ve tried it. Actually seeing your expenses and disposable income written down on a page helps to make it tangible. Take the time to learn how to write a budget, assess your lifestyle costs and examine your financial priorities. Most importantly honour your budget and stick to it.
2. Know what’s in your wallet
When it comes to money, mindfulness is everything. How often do we truly know the sum of money in our wallets vs what is in our account? Similarly we can sometimes unwittingly just whip our cards out and swipe, swipe, swipe. Whichever your habit may be, it really helps to know exactly where your monies are at all times learn how to keep track of your budget.
3. Examine your lifestyle spending vs financial priorities
It’s very easy to go from one extreme or the other. That is, saving too much and not considering your day to day lifestyle upkeep or blowing all your money on your lifestyle and nothing on a nest egg. Take a step back and examine your spending habits. Write it down what you spend money on in a month in order to figure out the danger zones and where you can make some changes. Not all months are the same. Figure out which months you have more free expendable cash and where you have commitments such as birthdays, anniversaries and special events to plan for.
4. Prepare more lunches and make eating out a special occasion
It may sound like a very elementary way to approach saving and financial planning, but it’s surprisingly more effective than you think. If you think about it we often go out to eat and spend a large sum of money on a fancy dinner, justifying it by saying that eating a necessity. But do we really need a three course meal for one night or nutritious home-made meals that will take us through the week nights? This isn’t to say that we should never have a good meal out, but rather to be strategic about where we go and to make it a special occasion.
5. Put some of your salary away every month
Even if you think that you don’t earn enough to save money, you can always plan to put away even the smallest sum. Take the time to get serious. Before you know it you could have a health emergency, a retrenchment, a car repair that needs attention. Where will you turn for money? This is where having a savings plan in place long before an emergency hits is the ideal plan. Even if you need to have a deliberate debit order that goes off with a set sum of money into a savings account every month, do so. For that matter to get yourself up to speed on mathematical literacy you could even study a course in accounting to help you with the basics.
Have you considered some alternative Ways to appreciate money?
- Practice gratitude
- Savour the moment
- Live a simple life
- Find creative ways to make money
- Changing your mindset and how you view money
Growth and development in the personal finances arena comes as a result of dedicated effort and commitment. Become conscious of who you are, what drives you emotionally and financially and above all move towards taking inspired financial action in your life. You can get to the financial state that you want to be in.
