If you want to get ahead you need to know how to manage your money very well, if you think of about many people struggle to manage their money because people don’t like to talk about it and money is not a subject, they teach us in school. Therefore, one need to figure this out and I would like to make this information available to you so you can make informed choice and take action that would help you to keep your money in your pocket.
- Pay yourself first: If you are employed and earning an income, when you get paid make sure you pay yourself by saving a proportion of your monthly or weekly salary and channel it towards investing. You can do this automatic, and it is what I am doing. I work with NHS here in the UK before my salary hit my bank account, so proportion is already forwarded to the bank I provided to the payroll department for my Trust. This helps me a lot as it was able to say for my house deposit using this method.
- Do not trust payday loan: Pay day loan comes with high interest rates and the providers have not your interest at heart, rather they are up to use your financial vulnerability to their advantage bringing to you more financial predicament than good.
- Do not be too scared to take risks: Business is about risks, the same can be said in investment. Some people say that they are not investing or starting a business because it is risk. What you need is to check the risk versus the opportunity cost. You cannot eliminate risk completely in life. You got to understand no pain no gain, you can minimize the risk by getting the necessary training and making the required research about business you want to venture into before finally kickstarting it and investing your money. You can take calculated risk that would help you to grow.
- Not fully understand investing: It is important to understand the rule of investing, knowing when to pitch in your investing is great way to manage your money. Knowing the company, you want to invest inside-out is the key. You need to understand what the company is producing and what value the company is providing/creating and how long the company has been in operation and their track record would help you to be good with your money. It shows you have done the due diligent about the company, the PE ration and intrinsic value of the share to ascertain what the value are. This would help to buy the shares of company when it is low instead of high, because in investing you need to buy low to be able to sell high to make profile. Not spending enough money and time to acquire the necessary information and material would hinder your financial growth.
- Buying good quality products, if you want to be good with your money you need to know how to spend your money on good quality products that have long durability and life span. It is better to spend money to buy a product with high standard that will last for years than to buy cheap and inferior products that will not last and will even cost you more money to repair. If you think of it, if you buy cheap fake products, it will spoil quite easily. By the time you check the cost to repair or to buy another one, you would realise that you would have been better off spending a little bit extra to acquire a high-quality product that you are sure that will last.
- Not having side hustle: Days have gone when you rely on one source of income. It is encouraged to have multiple sources of income if you want to be good with your money and if you want to get ahead. It is part of the game the rich know how to play very well. Having multiple sources of income would give you peace of mind and freedom to spend time with your family. Also, if one door closes, you will not be stuck, and it gives you time to strategize what you are going to do in confidence because you have other income streams. I have seen people who started a side hustle, and that side hustle goes on to be the main source of income and something that they are now doing full time.
- Not living beyond your means: It is good to live rich life, but you got to know how to live reasonably within your budget. Making sure you know how much your income is against your expenses. This would help you to find money to channel towards investing, acquiring assets that provide to you a passive income and building generational wealth. You cannot live extravagantly when you are building wealth, you need to know how to make do and get by avoiding high interest credit cards fee is part of the thing you need to master. It is quite easy to fall into the trap of credit cards company, if you are not careful with your money spending habits.
- Be mindful of Ponzi scheme and falling in to get rich quick scam, you need to be patient to allow your money to grow. You need to inbuild atomic habits in your money management. Having the mindset of starting little, understand that every penny counts in your financial journey. If you want to invest your money, you don’t see that benefit or reward instantly, it takes time to grow by compounding effect. Impatience can lead to rash decision making about money.
- Be proactive around money nailing your niche. You got to have action plan about your money-making principles and your business ideas. Not just self-beliefs about money but connecting the dots to reach your potential. Understand when to look for outside help, mentor and outsourcing to grow your business is required.
- Avoid unnecessary excuse or falling into victim culture. There are a lot of people who have become cynical about managing their money and acquire financial literacy rather than improving themselves and doing the necessary things that they supposed to improve their financial outcome.
- Avoid I cannot save any money mentality: Saving is about cutting costs, earning more, and optimising your spending. You do not have to wait until you have £1000 before you start saving your money. You can start little, the good thing about it is you are better than those who have not started at all. Psychology about money will encourage you that if you want to grow, it is better to start little. If you are in debt, start tacking your debt that have small interest that it will give you the boost and moral support to go on to tackle that big debt with high interest rate. If you take a survey some people may want, you to tackle debt with big interest rate. But it is our small wins that matters. The same can be said when faced with big obstacles, just focus on what you can do and the problem you can solve rather than be overwhelmed. Getting your financial situations together, requires some works and tough sacrifices, on the positive note understanding that the rewards often far greater than the effort.
Nice one vinnel