Consistently spending more than one earns is a surefire way to accumulate debt. To stay out of debt, one needs to either find a way to earn more or spend less. It is the traditional matter of cutting one’s coat according to one’s material.
So many people spend impulsively; they spend more than their daily, monthly or annual target. The higher the income, the higher the expense in most cases as demand rises with higher income.
A person who earns three million naira monthly and with an annual rent of 12 million naira will hardly be able to save. Feeding expenses and budgets for unforeseen circumstances would suffer the brunt of an income that has not been well managed.
Sadly, many people do not take saving seriously, not because they don’t have an income, but because they keep upgrading their lifestyles for competition by for instance, buying a nice car to a poor house, and for others, they simply procrastinate a lot.
They have no concern about the unforeseeable future, whereby there will need to raise huge amount of money which their monthly income may not be able to cover nor are they prepared for the emergency of health failure or a loss of job.
If a person invests 200, 000 naira every month, after 10 years at 10 per cent rate of return, the person would have over 20 million naira.
It is wise then to invest more than to spend. It is smart to calculate income and expenses per year. If your expenses are more than your income, then you know you are spending too much. Try budgeting and stick to it. We all love fun, fine but keep some money for fun but don’t go beyond the budgeted amount.
While being too emotional can make one spend beyond budget, one must be disciplined enough to try not to shop when one is emotionally down. One must not allow sentiments dictate how he or she spends; in this case, logic must win.
Avoid comparism and competition on social media. “Tolu just got an iPhone 7, I mustn’t get something lower than her own, or I can’t repeat same clothes on social media because most ladies don’t do so on social media” is a wrong perception. This would only lead you to go beyond your budget.
Blessing Iyabode Ajao,
Oyo State.
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