By way of a reminder, I mentioned in part one of this series that the first simple financial rule to live by is to "Pay yourself first". This principle, as simple as it seems is the bridge between where you are today and where you want to be in the future financially. It is the only secret to generating seeds for your wealth garden (investment).
Put in another way, paying yourself first simply means, deduct the money you will save first from your salary (or income) before you start paying your bills. And make sure that the money deducted is invested appropriately. The second rule is:
2. Practice Mindful Spending: The mindset that I have the freedom to use my salary the way I want to is not guaranteed. I think however that many people have more room to joggle their decision to spend than they realize. This is what I mean when I say that I think N10,000 is a lot of money. When I decide to buy something, it's a decision, not an impulse buy. I want to spend my money on things that really have value for me, not just things that are convenient or appealing at the moment or what other want me to buy.
So while I can buy something nice once in a while - without guilt - I have a hard time going out for lunch or buying (you can guess what). Less expensive purchases are an easy mental hurdle to get over because they're so small it seems that they could hardly amount to anything. The truth is, these seemingly insignificant purchases can easily amount to, or exceed, that N20,000 you may be aiming to save for a project.
If I spend N100 every morning on a Bread/Beans (Tea, Pap etc), and N150 each work day for lunch, this adds up to N1,250 per week (of five days) - for a grand total of N65,000 per year (of 52 weeks excluding my feeding for all the weekends - Saturdays and Sundays - in the year).
If I earn N70,000 per year (that is barely N6000 every month), I only succeeded in spending about 94% of my salary on food alone (don’t ask me if you should not eat). Do you really have to spend all that on Bread/Beans and garri/soup? This isn't to say that no one should ever buy and eat food rather the idea is for me to be creative with my expenditure because if I will have to spend this way, I won't have anything to devote to my savings. And that is a sign that these seemingly small indulgences just aren't affordable, at least for now.
Consider what you spend on ground nut, suya delicacies, boiled egg, sweet, chocolate, coca cola, La Casera etc every month (you may be amazed at the figures that will hit your eyes). This is why I've also decided not to opt for a cable TV or an internet subscription that bringing in money to my account.
I don't feel that I live like a pauper. After all, I have money saved that I can turn to not only in an emergency, but also to pay for things that I feel really add enjoyment to my life, rather than just distracting me for a few hours or days (and steadily subtracting much treasured naira notes from my bank account).
What Are Be The Rules?
Over time, I've learned to save money as diligently as I pay my bills. And where I cannot save immediately to accomplish a PROJECT, I take a loan. I use the loan to accomplish the project and commit myself diligently to paying off the loan within the specified time frame.
I also try to spend what's left after my deductions as mindfully as I can (that is on the things that fascinates me the most). I can't say I have always succeeded, that I never get to overspend or that I'm not often tempted to break the rules. Nevertheless, I'm sticking to the strategy that has kept me out of debt, and helped me save enough to meet some key financial goals — and still have some fun.
I know of other people who've done even better by employing these rules much more stringently than I do. As for me, I'll keep saving up for my next Project by keeping to the rules and trusting God to supply all my needs according to his riches in glory.
My advice:
1. It is possible to be financially free; and the two steps mentioned in this write up is the first ladder in the process.
2. Failure to have a financial plan means you are not in any way planning to succeed financially.
3. What is your financial plan?
If you do not have any financial plan, then you had better adopt this two simple rules, spice it up with a little discipline and watch how they will set you apart from the crowd in no distant time.
Put in another way, paying yourself first simply means, deduct the money you will save first from your salary (or income) before you start paying your bills. And make sure that the money deducted is invested appropriately. The second rule is:
2. Practice Mindful Spending: The mindset that I have the freedom to use my salary the way I want to is not guaranteed. I think however that many people have more room to joggle their decision to spend than they realize. This is what I mean when I say that I think N10,000 is a lot of money. When I decide to buy something, it's a decision, not an impulse buy. I want to spend my money on things that really have value for me, not just things that are convenient or appealing at the moment or what other want me to buy.
So while I can buy something nice once in a while - without guilt - I have a hard time going out for lunch or buying (you can guess what). Less expensive purchases are an easy mental hurdle to get over because they're so small it seems that they could hardly amount to anything. The truth is, these seemingly insignificant purchases can easily amount to, or exceed, that N20,000 you may be aiming to save for a project.
If I spend N100 every morning on a Bread/Beans (Tea, Pap etc), and N150 each work day for lunch, this adds up to N1,250 per week (of five days) - for a grand total of N65,000 per year (of 52 weeks excluding my feeding for all the weekends - Saturdays and Sundays - in the year).
If I earn N70,000 per year (that is barely N6000 every month), I only succeeded in spending about 94% of my salary on food alone (don’t ask me if you should not eat). Do you really have to spend all that on Bread/Beans and garri/soup? This isn't to say that no one should ever buy and eat food rather the idea is for me to be creative with my expenditure because if I will have to spend this way, I won't have anything to devote to my savings. And that is a sign that these seemingly small indulgences just aren't affordable, at least for now.
Consider what you spend on ground nut, suya delicacies, boiled egg, sweet, chocolate, coca cola, La Casera etc every month (you may be amazed at the figures that will hit your eyes). This is why I've also decided not to opt for a cable TV or an internet subscription that bringing in money to my account.
I don't feel that I live like a pauper. After all, I have money saved that I can turn to not only in an emergency, but also to pay for things that I feel really add enjoyment to my life, rather than just distracting me for a few hours or days (and steadily subtracting much treasured naira notes from my bank account).
What Are Be The Rules?
Over time, I've learned to save money as diligently as I pay my bills. And where I cannot save immediately to accomplish a PROJECT, I take a loan. I use the loan to accomplish the project and commit myself diligently to paying off the loan within the specified time frame.
I also try to spend what's left after my deductions as mindfully as I can (that is on the things that fascinates me the most). I can't say I have always succeeded, that I never get to overspend or that I'm not often tempted to break the rules. Nevertheless, I'm sticking to the strategy that has kept me out of debt, and helped me save enough to meet some key financial goals — and still have some fun.
I know of other people who've done even better by employing these rules much more stringently than I do. As for me, I'll keep saving up for my next Project by keeping to the rules and trusting God to supply all my needs according to his riches in glory.
My advice:
1. It is possible to be financially free; and the two steps mentioned in this write up is the first ladder in the process.
2. Failure to have a financial plan means you are not in any way planning to succeed financially.
3. What is your financial plan?
If you do not have any financial plan, then you had better adopt this two simple rules, spice it up with a little discipline and watch how they will set you apart from the crowd in no distant time.
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