In today’s world, the ‘generosity’ of financial institutions and enticing offerings from retail or department stores can make it really hard to keep finances on track. The avalanche of Buy Now, Pay Later, irresistible 75% Off Sales, tempting 0%APR for 2 years Credit Card offerings have all made it a huge necessity to keep finances on the straight and narrow path. Temptations to spend and impulse buy has greatly contributed to the shopaholic culture in our society today.
On the other hand, extravagant living and the unquenchable thirst to keep up with social status at all cost has landed a growing number of persons in the deep waters of debt. Excessive taste and spending on luxury goods above and beyond earning capability have led to unnecessary heartaches. Not to mention the desperate quest for payday loans in order to make holidays to the Carribean Islands.
Agreed, these temptations are there but how do you ensure a financial equilibrium. Because the ability to develop the discipline that curbs these excesses will not only keep you financially sensible but will also stop the creditors from knocking your door for repayments. Below are 3 simple steps to help you on your quest to grow your finances.
In my early teen years, I used to hear a lot of the word ‘budget’ in my mum’s vocabulary. As children, whenever we go shopping with her and we find something we really love to have, the moment we say “mum, I like this” she’d quickly reply with the words “it’s not in my budget.” Now, I’m really having a laugh about it, but back then I used to be very upset. Howbeit, I now perfectly understand her mindset about budgeting.
Budgeting is the practice of planning or pre-allocating your resources (salary or wages, pensions, benefits, etc.) prior to spending (rent or mortgage, utility bills, insurance, living expenses, etc.) This is a very smart way of monitoring your cash flow and keeping your spending within your means. It’s also a form of keeping a spending diary to track where you’re spending your money and what you’re spending it on.
Saving is a way of putting aside some part of your resources or earnings. Believe me, there’s always a rainy day and it’s worth preparing for. It doesn’t mean you’re anticipating a negative situation, but you’re putting aside something to fall back on just in case of the unexpected. For instance, let’s say you’re on a 150k/pa salary, you wouldn’t want to be fooled into thinking that it’s going to be 150k/pa or more forever. Would you? How about if it becomes halved or lesser than half for some ‘reasons’ beyond your control, what then happens to you? You see, so, don’t spend it all as it comes but be wise enough to put some aside!
This is when you allocate a certain percentage of your income for investment purposes. It is a way of making your money work for you while you’re asleep. There are a lot of areas you can invest into based on your personal interest and available opportunities. I will advise that you seek competent professional advice before you do this for optimum results.
In all of these, the keyword for finding your equilibrium in the face of high street temptations is discipline. Exercising the discipline to plan, save and invest your earnings, income or resources will set you off on the road to happiness and financial fortune.
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