Have you ever noticed that no matter how much money you seem to make there is never enough? Do you wonder why you never seem to get ahead financially? Have you ever taken an assessment of your relationship with money? This will determine where the problem might be. Then together, we can diagnose your financial disease and develop a plan of care to treat it and cure it.
Identify your Needs
You need many things in life including food, shelter, clothing and education. Needs are those things that you cannot live without or thatliving without would cause hardship and distress. Knowing whether something is a need or a want is important since your perception will determine whether you spend your money on it or not.There was a time – not so long ago - when there were no cellular phones or E-mail – and we managed, just the same. New technology is created to make things easier and enhance the quality of your life. But technology doesn't eat a hole in your wallet or put you into debt– you do that when you choose to purchase things you cannot afford. Many people feel they deserve to "treat" themselves to expensive items or spend money they don't have on living a lifestyle they have yet to earn. They charge these "rewards" on borrowing. But there are costs for borrowing money, besides the fees and the interest, you experience the stress of being in debt and you are living a lie. And yes, you still need to pay the money back for those expensive things that you purchased. As you know, companies use advertising to market their products. The role of advertising is to create "needs" for the things that you"want" which influences purchasing behavior. It's your job to decide whether each new product is something you really need, something that will make your life easier or add to the quality of your life or, whether it's something you can continue to live without. The amount of money you have to spend is finite; everything in life is a trade off. If you are going to spend your money on one thing today then this becomes money that is not available for saving or for purchasing more important items in the future. Just as you prioritize your time, learn to prioritize your spending. Before you make a purchase, ask yourself whether the item is a need or a want and decide accordingly.
Use Cash Only
Accept responsibility for your financial situation and change your spending patterns. Reward yourself by purchasing items with good old cash and developing a savings plan. A couple of things will happen.You will think twice before you spend your cash and you will start building a reserve of money to support you for a "rainy day". Not to mention, you will have the ability to save more for your retirement. Identify your spending habits by writing down every naira you spend for a week or two. Identify how much you're spending, on what and where your money is going. Eliminate all unnecessary spending such as unnecessary phone calls, unneeded gadgets, and wasteful purchases.Return items you will never use. Examine every bill you pay; is there any way to lower your bills – perhaps eliminating a luxury item? Put money back in your pocket by identifying areas to cut back. My clients have found hundreds of naira that they were able to cut back –a week! Make a game of it and include those in your family.
Owe No Man!
Eliminating debt is an important part of the process. Debt is created from many sources: a spending addiction, living a lifestyle beyond your means, being driven by wants, impulse buying and a lack of respect for your money.
Save For A Rainy Day
Open a savings account and start saving 10-20 percent of your earnings. If you can, have the money deducted automatically out ofyour pay cheque. Take pride in saving your money; after all, you are working hard to earn it.Imagine your bright financial future with plenty of extra money and no longer living hands-to-mouth. Imagine having #1,000,000 in the bank. How would that feel? What about #5,000,000 or #10,000,000? You might think it's impossible, but all it takes is learning to make better choices. It's about learning to exercise the proper respect for your money. It's not the big-ticket items that are the problem; you carefully plan for those purchases. It's the small, day-to-daypurchases that are stealing your financial freedom away. What is#100,000 anyway? It's one hundred thousand of those little one-naira bills!
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