managing finances 2

Finance/ Money is an issue of discussion in almost every adult’s life on a daily basis, therefore its significance cannot be overemphasized.

It is known that money plays a very serious role in our lives, homes, relationships, marriages, and the list goes on. With this in mind, I would like to state here that unfortunately, many people do not know how to go about their daily, weekly, or monthly income, which leaves them running the rat race for the whole of their lives.

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The irony of Managing Money

Have you observed that some people who earn more than you often meet you for some help and vice versa? If you fall in the category of those who people meet for help despite your low income, I would like to give you kudos!

It has been observed that with improper money management, your income may never be enough, no matter how much you earn. There is a saying that ‘More money, more problems. You may earn #50,000.00 today, and you may be hoping to earn more so you can save and do more with your funds but then, the moment you start earning #100,000.00, you realize that those shoes of yours are no longer good enough, neither is your phone nor your wardrobe. Eventually, you find yourself in the same old circle which you were before you started earning #100,000.00.

Some people even eat away their future!. You could see a man who earns a reasonable amount of money spends on food as if he is preparing himself for slaughter. Whereas, he could have reduced the amount he spends on food and direct them somewhere else, which is also important. As much as food is a basic necessity of life, taking so much at a time will only result in excess fat and toxins in the body, it is better off taking what your body needs at any time which is little and more fruits and vegetables.

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Managing money is not easy, because most of the time, resources are limited. There is, therefore, a need to apply the ‘Economies of Scale’ or ‘Scale of Preference’ which is “Forgone Alternative’ or ‘Alternative forgone’ i.e placing your needs above your wants.

Differences Between NEEDS And WANTS

In life, there are NEEDS and there are WANTS. NEEDS are those things we cannot do without, they are indispensable, that is, things that are basic for our day-to-day lives, like housing, feeding, clothing.

While WANTS  are things that we can do without, they are things that we normally crave, such as goods of ostentation (Expensive pieces of jewelry), the latest cars, the latest phones, etc. They are things you do not need to live your daily lives but you probably get to live a fancy life.

Back to ‘Forgone Alternative’. What this means is simply prioritizing your expenses, putting your NEEDS above your WANTS. For instance, if you are making a list of how to spend your money, always place those items that you cannot do without on the top of the list, before adding other items that you may desire out of pleasure.

As much as you try to prioritize your expenses, manage your finances and budget, it is always never easy. Below are tips to help you get by with your new lifestyle;

Top 14 Tips To Help You Manage Your Finances – Money/ Budget

  1. Always remember your monthly income
  2. Endeavor to Track your monthly spending.
  3. Remember that you are not in competition with anyone
  4. Save, Save, Save! At least 10%-20% of your income
  5. Never stop looking for another source of income
  6. Invest some of your savings
  7. Leave some of your savings for emergencies
  8. Create a household budget you can work with.
  9. Review your budget from time to time
  10. Pay your monthly bills on time to avoid late charges.
  11. Always review your credit report.
  12. Avoid using credit cards
  13. Take advantage of free money.
  14. Assess and review your insurance policies.
  15. And of course, make more money.
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Good luck as you put these tips into practice. Feel free to share, like, comment below, and subscribe to get more tips on money management.

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