I have a couple of people ask me why they still find themselves struggling, even when their income is fair enough. If you have ever found yourself in a similar situation, you sometimes wonder if someone might be stealing from you or if you lost some money. The truth is, there is probably no one stealing your money and you probably did not lose any money, the problem lies with you. I will be sharing with you some of the habits you may have that make you endlessly struggle with your income.
Increasing your Expenses as your income increases
Sure, we all want to have a good life, no one likes being poor. So, you have been struggling with your income and you hope for some increase that will cease all of your financial struggles. The increase suddenly comes and you remember all the fancy and nice things you have been dreaming about, you think the time has come to get all these things to make your dream come true.
Spending so much on food
As much as it is okay to give yourself a treat from time to time, it is good to try as much as you can to keep your expenses constant, thereby giving you room to save the extra cash that comes with your pay increase.
Food is life and without food, we cannot live. It is very important to eat well so that you can be healthy. However, what sense is there in consuming a meal enough to serve 3 people at once because you think you can afford it when your body only takes what it needs and the rest leaves the body as waste.
Try to train your stomach to eat lesser but quality meals (Balanced diet). One way to go about it is by taking some water right before a meal. By consuming so much food at a time, you actually waste money.
Wasting Money on Utility Bills
Some bills are inevitable but it is important to learn ways to reduce how much leaves your pocket at the end of the month or as the case may be. Leaving your tap running while brushing your teeth makes you waste water that you will eventually pay for.
Turning off appliances while away or when not in use will help you reduce some costs in your electricity bill. Same goes to air drying your clothes rather than using the machine as this will also help save your clothes and your money in the long run. When using your electric kettle, for instance, boiling just the amount of water you need, enough to cover the kettle’s ring would save you tons of money on electricity bill in the long run.
Eating Junk Foods
Cutting down on junk foods will not only help you save money but will also help you live a healthier life. Junk foods accumulate over time to become toxic to your body and will eventually make you sick. By the time you get sick, you spend more money getting treatment for the problem you brought upon yourself.
Instead of junk foods, spend your money eating fruits and vegetables including healthy snacks, now, that is not to say you won’t indulge from time to time. You should also incorporate the habit of exercising to help build your muscles as you also need to be fit to be healthy.
Buying Brand New Items
New items are good to acquire but when you have limited income, you want to find alternative. You may choose to buy a used couch for instance and refurbish it rather than spending so much on a new one. Same goes to cars and some appliances.
Caution should be applied though when buying electrical appliances. Make sure they are in good working condition before buying them.
Buying High Maintenance Cars
Depending on your income, it is wiser to buy a car that has low maintenance cost than the one that would literarily tear your pocket over time. Cars have various engine types and sizes and of course, the bigger the size of the engine and tank, the higher the amount required for fuel and maintenance.
Same applies to the cost of their spare parts. Be sure to buy cars whose spare parts are readily available so you do not find yourself stranded, should you have a need to replace a part in your car.
Focusing on the Present
There is this believe that some people have that goes thus ‘Tomorrow will take care of itself’. This is a very wrong way of thinking. As much as the Bible says ‘Give us this day, our daily bread’ does not mean we cannot work today and store for tomorrow.
Have you wondered why the need for preservation? In the spring or raining season, we grow food and store them for the winter or dry season. This brings us to the fact that it is very necessary to reserve whatever you have now in preparation for what lies ahead in the future.
The future is unknown and the better prepared you are for unending challenges; the better it is for you.
Waiting for the right time
The right time to start saving is NOW!. Yeah, there may be some financial challenges at the moment that need urgent attention, for instance health issues which cannot be ignored. Health they say is wealth, so if you find yourself in such situation, try to device a way to first take good care of yourself as you cannot be saving the little you have when your health is in question.
However, once that phase is over, try to manage yourself so you can get out of the cycle in which you find yourself. One way to do that is by eating healthy. Save even before you spend.
Not Keeping Proper Record
If you are a salary earner, at the end of the month, you are paid and then the next thing you do is spend on all the things you had in mind. At the end of the month you have no idea what amount went to what expense and so forth.
There is need to start taking stock of what and what you spend your money on. You may be shocked at how much you spend on ‘silly things’. You may have an idea of what your huge expenses are but it is actually the ‘small things’ that eat up most of your funds. Start now to track your expenses so you can have a better grip on controlling your expenses.
Lack of Budgeting
In my previous post, I shared tips on How to Budget properly. You may click on this link to read more. It does not end in keeping records or keeping track of all your expenses as at the end of the day, you only have an idea of what you are actually spending your money on.
There is need to budget by setting aside some money for various expenses on a monthly basis. When you start budgeting, you start seeing your money from a totally different angle and it prevents you from being carried away as that may have been the case. When making a budget, always make provision for loan repayments, if any.
Stick to your budget
It is not enough to prepare a budget, sticking to it is equally important. I have another post where I shared Tips on How to stick to your Budget.
You need a level of discipline to be able to stick to your budget as there are tendencies for you to derail from time to time.
Separate Your Wants from your needs
If you plan to live a good life, save and build wealth over time, then it is high time you applied the principles of Economics to your life. In my post, Managing your Finances – Money, I shared tips on how to differentiate your wants from your needs.
Applying these principles will help you realize that there are things worth sacrificing for others in other to achieve your goals in life.
Having too much debts
It is always nice to get loans, credits and overdrafts as they help you solve problems that require urgent cash that you may not have had access to at the time it is needed. It is however very important to note that loans, overdrafts, credit cards and the likes are not fun when it comes to repayment.
This is because you find yourself struggling with whatever is left after the deductions have been made. It is usually better to save up over time for whatever needs you
In the same vain, it is not advisable to ignore your debts as your interests keep accumulating over time. Make whatever sacrifices you need to ensure you get out of debt as soon as possible.
Buying Latest Appliances & Gadgets
There is no harm in getting the latest gadgets or appliances out there but ensure that whichever you choose to get is what you really need. The truth is that latest versions of appliances and gadgets spring up all the time, the latest appliance of gadget today becomes an old model in only a few months. Take charge of your life and put your expenses in check.
It is not enough to put some cash in your savings account on a monthly basis, it is also important to invest your funds in assets or businesses that can actually yield profit and eventually increase your income base.
If your job is full time, you may invest in a side business that you can do from home. You can invest in fixed deposit accounts, treasury bills, mutual funds and the likes.
I hope my tips are able to help you change some habits that have kept you living from hand to mouth or from paycheck to paycheck. Feel free to share, like and comment, I would be glad to read from you. Cheers!