There is a saying that “it’s not about how much money you make but how well you manage what you have”, of a truth this is the gospel truth.
TIP 1::RECORD THE DYNAMICS OF THE MONEY THAT COMES IN AND COMES OUT.
At this stage there are three important question to ask
1. Where did it come from and where will it go
2. How did it come in and how will it come out
3. Why did it come in and why did it come out
as we all know, our needs areusually higher than our income..but asking these questions will help us regulate what is necessary and what is less important
TIPS 2:: CREATE A PASSIVE SOURCE OF INCOME
passive income refers to income that you don’t have to be actively engaged in or directly working for it…
you can research other sources of income aside your active income ie salary business etc… as a matter of fact salaries doesn’t make people rich passive income does.
So expand your source of income , invest in things that has the capacity to raise you passive income..
poor men work for money Rich men make their money work for them.
so to make a difference you need to leave your comfort zone and explore other sources of income.
So always increase the sources of money that comes to you
TIP 3::SPEND WISELY
Financial literacy entails knowing the difference between ‘needs’ and ‘wants’. He who buys what he doesn’t need steals from him.
A need is something so important and essential which if you don’t get it you’ll probably die ie food, water, shelter, clothing
But most times our spending are based on ‘want’….things that we probably thought we can’t live without, but in fact you simply desire to have. ie mobile phone….
Too many people spend the money they’ve not earned to buy something they actually don’t need but simply want to impress people they don’t like.
You can enjoy the pleasures of life but make sure you’re within the budget.
TIP 4:: DIFFERENTIATE YOUR ASSET AND LIABILITY
Asset is something that gives you money or keeps money flowing in and hence increases your value.
A liability is something you actually spend for and will siphon your income into spending, ie mortgage a car
You’ll have to spend monthly paying on installment.
You’ll have to buy the gas/fuel.
You’ll have to spend for it’s maintenance.
Most friends usually think a ca r is a good investment, but at the end they realized that a car is not a need but a want
So why did they buy the car anyway?
They just wanna show off, they are driving a brand new car!
But people in the street don’t even care
So the next time you want to buy something of value make sure it’s an asset
TIP 5::DIFFERENTIATE YOUR SAVINGS FROM YOUR INVESTMENT
If you tell me that you have money in your savings account, that’s savings that’s not an investment WHY?
it’s certainly not earning you money.
Investment refers to the portfolio that you may get into where ‘Money Earns Money’
Yes savings is ok as a matter of fact the old folks advised us to save enough money to sustain our needs for the next 3 months without working…probably if you do this you may have some peace of mind and a sense of comfort.
Now listen the gospel truth is with salary you may never be able to Earn nor save such before you give up. So don’t work with that Jargon….
SAVING IS OVER-RATED
If you're a young person with a big vision but you're still earning little amount of money for now, Forget about SAVING for now.
Yes you heard me right, I said forget about SAVING for now.
What you need to do now is to start investing in yourself via skill acquisition.
Buy as many courses as possible, go to workshops, seminars etc.
Let me tell you why.
Assuming you need #500,000 to start up your dream business and currently you're earning #50k salary every month.
Let's assume you're very meticulous in spending so you're saving #20k every month.
It will take you 2 years and a month to save up #500,000.
The hard truth is that you wount still save all those money without touching it, don't forget that you have family to show love and don't forget that your landlord will visit.
So it may even take 3years or 2 and half years to save it up.
HERE is "4G therapy" and that is what you should do.
Invest that first 20k in yourself by acquiring a skill.
in the second month invest the second 20k in that your skill by taking a course.
In the third month do the same thing. Surf the internet for videos and trainings.
If you will do this for 6 months, two things are permitted to happen.
1. Either you make the required #500,000 for your dream business in the remaining six months of the year. OR
2. Your new acquired skills will slash that starting up capital to zero or something very small that you can start business immediately.
Because the more skills you have, the lesser the capital you will require when starting up a business.
A penny saved today will remain a penny next year, Ooh sorry it won't be up-to a penny next year because of bank charges.
Stop enriching bank's while you perish.
INVEST IN YOURSELF.
*To be continued.....................*