Updated: Sep 16, 2019
Original version was posted on www.aiicopension.com on 18 July 2019
Do you often find yourself in boat-wrecked situations where you are unable to cater for financial emergencies? Are you often stranded and in need of a cash bail-out despite earning more money ?
Well, here are important financial tips to help keep your financial boat afloat in the unpredictable financial situations that define economies in our world today.
Get a budget and stick to it
Make a honest appraisal of your average expenses per month, then categorize them to either needs or wants. For example, needs are items like foodstuff, toiletries, etc which you can't really do without, while examples of wants could be exotic drinks, fancy clothes, jewelry, and so on. You could also use broad categories like food, clothing, entertainment, etc.
The categories with the highest spending in relation to your income will be the best areas to save income. This will also help you set financial limits for each category in relation to your earnings, as well as keeping some for emergencies.
Avoid impulse purchases
Nothing ruins your monthly budget than impulse purchases. This is because most items purchased on impulse aren't always of essential use, which is usually influenced by making one or more of the following mistakes:
Not drafting a list before hitting the stores. No one doubts the fact that you have a good memory to remember the things you need, but stores sell things you don't need and they are experts at making them attractive. Clearly outlining the things you are heading to buy at the stores helps you resist the urge of buying the unnecessary.
Falling for sale tricks N 199.99 is the same thing as N 200. A purchase list also serves as your sales trick bullet-proof vest, as your needed items will bear their corresponding prices.
Shopping with others: Living on a budget means shopping alone. This will help you curb getting items out of external pressure (either in an attempt to impress or not look bad).
Develop a Savings Habit
In his book "The Richest Man in Babylon", George S. Clason shares a set of timeless principles to ensure financial freedom one of which is to pay yourself first. He suggests saving at least 10% of your earnings and putting it to work for you, if you want to save money for your future and avoid getting stranded financially, you must begin by consistently setting aside part of your earnings today.
Are you stranded ?
We will do a deep dive into the principles Clason wrote about in his book in a subsequent post but for those that will like an early start reading this book we will be giving away free copies of The Richest Man in Babylon to the next 10 subscribers to our blog. All you have to do is subscribe and post a comment on which of these three tips is your favorite and why it is.