A few days ago I wrote an article on how our spending patterns has an impact on how we reach pay day. ( Read it here). Some reach pay day connecting it with pay day loan, some are nursing their last N$100 , others are floating on overdrafts while a small % of the population are in different as they have a good cash reserves built up. Depending in which category you fall, my plea was to identify what it is that you doing well and get better at it but most importantly; stop whatever bad habit that is causing you to be strained financially.
While I may not know what is causing you to be strained financially, we can agree that there are some common bad habits that can contribute to financial stress. These includes but not limited to:
- Instant spending– If you can, delay spending your salary for at least a day. If you get paid on the 25th, use whatever penny was available in your account in the 24th so that your effective date of spending is the 26th. This practice helps you to practice self control and resist the temptation of instant gratification.
- Unnecessary trips in the mall or in the shops. Shops normally have pay day savings because they know people cannot resist sales. You are bringing your self in a situation that will tempt you to buy things you would not otherwise buy had it not been because you went to the shops. If you can, stay away from shops at least until you have calmed down from the excitement of having money in your account. ( Remember your brain was never wired to deal with money).
- Pay day pampering– because it’s pay day, you feel like treating yourself and buying something you would not otherwise buy if your bank balance has not been at XX. There is no problem with this but at least this amount should be part of your monthly entertainment budget and you would not want to deplete it on day 1.
- Defaulting on people’s loan repayment. If you have borrowed money from a friend or a bank, please remember to have a budget that will ensure that you honor your commitment. If you spend before you do this budget, you might have to end up defaulting on your commitment which may cause stress and anxiety for the rest of the month.
In order to break some of those bad habit; learn to relax , breath and remember that you have worked 31 days of the month to get that salary so it really will not be fair to destroy it all in one day.
- Have a rough estimate of how much your expenses are and compare that to your income.
- If your income is more than expenses, then consider saving the extra. In addition, get into the habit of saving a little that you really do not need to spend.
- If your expenses exceed your income, ensure that you do not have unnecessary expenses that you can live without and find means to survive on the little you have.
- Avoid life style chase. There will always be people having more money than you are, driving better cars as well as living in better apartments. Accept it, it’s part of life.
- And lastly in Africa we share. Happy Africa day
You only become better at what you practice daily. What are you practicing today in relation to how you handle your money? Think about it?