Throughout my life I have seen many people deal with financial problems, which bring with them endless problems and can cause us to fall into some of the following mental states:
- Anxiety – Since being submerged in debt or lack of cash flow, we fall into a state of anxiety to find a solution, which generates stress.
- Stress – It is so common to hear people say that they are “stressed” because they are not able to cover all their expenses, and even could not cover their basic needs.
- Despair – Failing to find a solution to the financial problem, people fall into despair which can lead them to perform improper and sometimes illegal actions in order to get out of the problem, which can sink them further.
- Depression – Many people fall into depression as they do not feel able to contribute to their home, or unable to pay off a debt, or unable to give their children what they need.
These could be said to be some of the most common mental states, of course there are many more, but in this post I do not want to go deep into what can cause financial problems, rather I want to provide some tips that have worked throughout my life and they have allowed me to lead a full life. I clarify, I am not yet a millionaire, and these tips will not make you a millionaire, but they will help you to live a full life if you manage to fit them into your life.
Take these tips as a guide, I clarify that each one of them must be adapted according to your situation, if you leave your comment, I will gladly seek to help you.
1 Live your reality
This I think is the main advice I can give you, live your reality, with this I do not mean that you do not seek to improve, on the contrary, you should always look to grow and generate more income, but you must learn to live your present. There is a phrase that I have read repeatedly that is attributed to Will Smith: “We spend money we do not have, in things we do not need, to impress people who do not care”, many times we want to pretend a lifestyle that we can not really carry, or we want to follow a lifestyle that we cannot longer afford.
It happened to me, from different situations, a time in my life I had 2 jobs, not because of necessity, but because the opportunity presented itself, but after a while the fatigue reached such a point that I could not continue with both jobs and a new job opportunity arose which I took and left both jobs, this caused a reduction in my income, but I wanted to continue living at the same level I was used to, which led me to fall into debt and to feel frustrated of not being able to give me the luxuries I wanted, once I accepted my reality, I managed to pay off the debt and get out of frustration. Such a simple example, I personally enjoy the food, go to a good restaurant and enjoy a good meal, which can be expensive, previously I could enjoy it at least once a week, with my new income, I could do just one once a month.
2 Keep an updated Budget
Carrying a budget is one of the best tools that will allow you to have an overview of your financial situation, depending on each case, and how you get paid, you should project it either weekly, biweekly or monthly. There are many tools in the market that can help you, you should find the one that best suits you, in my case I use excel, a simple file where I place the approximate income that will be received and the expenses that I will have, some fixed, others estimated , the expenses are divided into 3 columns “Payments”, “Payments Made”, “Payable”. The column of payments is the estimated expense that I will have to make, payments made is filled by placing the payments that I give and payable contains what is still pending to pay for that expense.
The secret of the budget is that you keep it updated, any expense you do, must be added to the budget and you must compare your budget with the cash you have or your bank account, with this you will know how much you have, how much you still have to pay and how much you will have left and With this you can make projections for the following months, my advice, do your projection for at least the next 3 months, with this you can plan better.
3 Properly use Credit cards
Many people say that credit cards are the worst, others that are the best, there are many in favor and many against, I give you my point of view and my advice on how to use them. As a first point, remember that a credit card is not an extension of your salary, meaning, the credit card DOES NOT increase your income, having this clear, when budgeting properly and knowing in advance your cut date and your payment date , the credit card can be an extremely powerful tool. DO NOT accept credit cards from any entity, serious banks will not be giving away the credit card to anyone and will not be giving high limits just because.
Never spend more than you can not pay cash and keep your budget updated with the expenses you make with your card, review your account statements and compare them with your budget, both must match, and if it does not, carefully check that You don’t have a strange charge.
4 Savings, Investment, Pleasure
This point is extremely complex and a very useful advice I read in one of Robert Kiyosaki’s books, which teaches first to pay yourself and then pay everything else, this has possibly been one of the points that was hard to apply in my life, since usually you would look to save what is left after paying everything, and usually you will always find a way to spend the money, but when you do it in the opposite way, you first “pay” yourself, meaning, you first take a portion of your salary for Savings and Investment, then with the rest you pay your commitments and with what remains you give yourself pleasure, you will realize that soon you can make your first investment, or you can start a business, etc.
You will notice that you will always have money, and you will begin to see that the money attracts more money. The best advice I can give you is: Assign percentages for different items, a simple example, propose 5% of your salary for Investment, 2% of your salary for long-term savings, 2% of your salary to save for some luxury you want give you, 1% of your salary for emergencies. With this you are only setting aside 10% of your salary, but with the passage of time you will realize that you will have enough saved to carry out different projects. In my case, apart from those percentages, I set aside 10% of the tithe and I give it to the congregation, take note that I do not want to cause any controversy, but I have witnessed and experienced what Malachi 3: 10-11 says “Bring the whole tithe into the storehouse, that there may be food in my house. Test me in this, says the Lord Almighty, and see if I will not throw open the floodgates of heaven and pour out so much blessing that there will not be room enough to store it. I will prevent pests from devouring your crops, and the vines in your fields will not drop their fruit before it is ripe,” says the Lord Almighty. ” I leave this to your discretion but the best business partner you can have is God.
5 Multiple Income
Do not depend on a single source of income, this applies to everyone, regardless of whether you are Director of a renowned company or if you are a worker, always look to generate multiple income. That is why an investment item is assigned within the budget, which you can use to create a new business that generates a second source of income. Whether it’s a food sale or a consultancy that you can provide, always look for ways to generate multiple incomes.
Possibly you have already heard these tips, now what I challenge you is to apply them to your life, make them a habit. At first you will feel that it is impossible, or that your income level is not enough to do it, but if you focus and make small changes, you will see how it is becoming easier and easier. There are many other tips that I will be sharing in other posts, but for today, this is what I wanted to share with you.
Be disciplined, learn to say NO and you will see how your wallet will thank you. Discipline is the key for making changes in your life.