This year, 2020, has been a long and stressful one because of the various things that have happened this year. Many people have said that this year is the year of the impossible becoming a harsh reality. A pandemic, a number of unexpected celebrity deaths, an earth tremor and a looming economic crisis. What could possibly go wrong now? Well your finances could definitely crash hard (not being a doomsday prophet but hey….) I know quite a number of people whose finances are on life support after being drained for almost 9 months since the pandemic took over this world. If I’m honest with you guys when your finances are on life support it stresses you so much. I’ve told many people that I’m a nice person (the jury hasn’t given their verdict so I’m a nice person), so I’m here to give advice on one or two ways to ensure that your finances survive this year and serve as the foundation for financial increment next year. I’m also open to suggestions from you guys….please share because some people really need this advice and suggestions to move from life support to the recovery ward.
Live within your means
This is one of the most controversial aspects when it comes to financial management. Many people have an issue with determining what their standard means is and that pushes them to go beyond their actual capabilities thus putting them in a hole. Here’s the thing if your weekly spend is 50 Ghana cedis, 50 pounds or 50 dollars, the big question you should ask is; “Am I spending right? Or I’m going overboard?” People will disagree with me here but I have a classical example that will buttress my point. Most of my friends use iPhones and Samsung phones while I don’t because I know where my pocket is. Let’s say I have 2000 Ghana cedis in my bank account and I need to buy a new phone. The thing to consider when spending money is how much can you save. Using an iPhone is a luxury and I’m not saying its a bad thing but looking at my bank balance, my target should be to save some of the money after buying a new phone. Instead of now needing to look for extra money to afford the iPhone 11, I could take 1,249 Ghana cedis and buy myself a Tecno Camon 16 and save about 751 Ghana cedis. Many people will contest this example but here’s the case, I’d be mismanaging my funds and in a year of unpredictability that wouldn’t be a good idea. My message is simple, know your financial muscle and don’t try to go beyond especially if there’s no change in your income stream.
Save! Save! Save!
Yep! This should’ve come up first but it’s not a problem now. Many people fail to save consistently to make progress. You’ve got to save as much as possible and my advice would be to save at least a tenth of your income. Saving money isn’t easy and the current situation has created an even more difficult situation for all of us. (Yep! myself inclusive). Once you start saving, it becomes a habit and you start doing it unconsciously leading to amazing benefits for you. Between now and December, I believe it is very possible to save 150 Ghana cedis and that works out to 50 Ghana cedis a month (difficult but not impossible). Just set a target for yourself and do everything in your power to meet that target.
These are just a few tips I came up with in 6 months (I think I should start a consultancy service….what do you guys think?) All in all I want every reader to do everything possible to move our individual finances from the intensive care unit to the recovery ward. Let’s do this together and remain safe while saving. (In other entertaining news, Dave’s Financial Consultancy is open for business…..come for good advice on how to manage your finances……)