At this time that Nigerian workers’ unions are clamouring for an upward review of the Nation’s minimum wage, it is necessary that we also understand that we need to plan as salary earners on how to manage our finances else no amount of minimum wage will help us achieve the financial stability that we so desire.
For most salary earners today, the task of managing their monthly income has become a very difficult task.
This is so because managing and living within your monthly income require great discipline.
The bitter truth remains that human needs are insatiable and increases with any slight increase in the level of income. So if you are among those that are saying that they can achieve some level of comfort if only there can be a pay raise then you are just a sitting duck waiting to be ambushed.
Money Tips for Salary Earners
Identify all your possible income and do an estimated projection
This may sound ridiculous but from experience, I can boldly tell you that it helps.
identify all the possible sources of income for the year, be it salary, business, and so on, then do a projection of your total income for the year. Doing this will help you when you want to do your annual and monthly income.
Stay out of debt
The longer you stay away from indebtedness, the better for you. What we see these days is people spending and unearned income.
Spending unearned income means when you collect loans from either friend, relatives most especially to spend on unnecessary things with the hope of paying back when you get your next paycheck.
If you must achieve financial freedom and buoyancy then you have to stop spending the monies that you have not earned.
Debt swallows your future income.
Have a yearly and a monthly budget plan
Budget is not necessarily the final plan on how you monies must be spent rather it helps guide you on how to expend your income. It gives you the opportunity to avoid waste of resources on things that are not needed. Most importantly, you must remain faithful to your budget.
Your budget must contain every major expected spending to the very minute ones like utility bills.
create a yearly plan for your self. The plan should be flexible enough to accommodate new but necessary items in the future or even removal of items that may be overtaken by event or no more needed.
Your annual budget should be numbered and prioritized for easy implementation.
Secondly, you need to break your budget into small parts. Create a monthly budget and insert all the items in the annual budgets to fit into a particular month.
By breaking your budget into small units (monthly), you will find out that implementation becomes easy.
One of the importance of budgeting is that it will help you not to forget any expenses and help controls your spending
Save before spending
One of the major mistakes we do nowadays is that we spend and then save the remaining change.
If you must gain financial freedom, you must as a matter of urgency cultivate the habit of saving before spending.
You can decide to be saving between 30 – 50 per-cent of your monthly income.
These savings will serve as a buffer in case of emergencies like job loss, illness, and other unforeseen circumstances.
Spend on needed things and avoid waste
Avoiding impulse spending will do you a great deal. Go for only the needs and not wants.
Run away from avoidable wastes. Try to do things like cooking for yourself, storing of cooked food in refrigerators, buying things in bulk and from wholesalers, avoiding drinking and womanizing, leaving close to your workplace if possible to help you spend less on transportation to work.
Live within your paygrade
There is no point trying to impress someone with your lifestyle when you are fully aware of the pressure you are putting on yourself.
Never go for what you know you cannot afford. One of my former bosses once said, don’t rent an apartment that your two months salary cannot afford.
These days and most especially in high brow cities like Lagos and Abuja, it may be difficult to implement that when it comes to renting an apartment, but what you need to understand is that you need to go for the thing that your paygrade can afford you until maybe when you can afford an upward change.
Learn to say “NO”
I think I also need to learn this part very well.
I know that some will argue that givers never lack, but I want to tell you that you can’t give what you don’t have.
It is unfortunate that in this part of the world that we carry our burden, that of our immediate families, extended families and sometimes even friends.
The truth remains that everyone has one financial challenge or the other. The earlier you learn to say no to some certain demands for money from one quarter or the other, the better for you.
This is because some of these requests or demands can be draining that if you don’t exercise caution you will end up becoming broke from attending to them.
Get another source of income
You will agree with me that the economic situation in Nigeria requires that you have multiple sources of income.
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Don’t just sit down and expect things to take shape on its own. Go out there and look for that extra thing you can do to earn more money. No matter how small the business might be, try to research about it and invest your time and money in seeing that the initiative comes alive.
Engage your self, work hard but smart and liberate yourself from poverty.