By Jeff Mote
I was once told that money is like a sixth sense, without it, you can’t make complete use of the other five. This just goes to show that money does play a critical role in the richness and quality of experiences one has in their life. It also means that you ought to be a careful steward of your finances in order to get the most out of these experiences.
Most of us though, have had a complicated relationship with money. For some, very ruthless; and for others almost a friendly one.
My personal experience with money has been an experiment of sorts. I started earning while in college, doing some part time jobs. I’d get enough to pay for my upkeep and some luxuries. I had tasted some financial independence. My parents could sigh with relative ease. I made some good money decisions and many mistakes. I enjoyed and regretted at the same time. But hey, I learnt my lessons.
After realizing I was developing some unhealthy money habits, I called myself for a meeting. I became my own auditor general. No one else knows best where the shoe pinches but the wearer. The output of my meeting with self was unanimous. Simple but practical guidelines were now necessary for me to make good use of my little money, since I’d soon be out of school with little or no parental support. That thought made me shudder the same you would when you see a traffic cop approach you when you are over lapping.
The first thing I learnt is that money loves some company (or is it some company loves money?). Birds of a feather flock together, if I can use this all-time favourite cliché. So I did an audit of the associations I had at the time. It’s not actuarial science, no! I knew each one of my friends and what we had in common or did together that was chopping our money. I then began realigning my friendships with my new financial goals. I dropped some associations and redefined others. All in all I started to spend more time with those whose mindsets were on saving money and growing their income. I then set personal goals to guide my journey in prudence. I embraced stewardship as my new guiding principle.
In the zeal of my new-found obsession with financial discretion, I asked my own mother for advice. She has raised five grownups, you see. She told me to always remember that emergencies do happen and that’s why I needed an emergency fund or savings account for a rainy day. For instance, in case you lose your job or should your business go belly-up you always need a soft landing, a source of income that will keep you going through the tough times.
Money is a limited resource; it’s never enough! Ask the rich. There’s always an extra need beyond the net of your earnings. That nagging desire that requires military discipline to silence. That’s why the architects of language inserted the word “Priorities” in the dictionary. To walk this tight path, I have learnt to sincerely always ask myself if that if I really need that Mont Blanc watch, Volkswagen Toureg or Zanzibar vacation or is it something I can do without, at least until I have an acre of cash. Any watch can tell the time, just as any vehicle will get you to where you need to go. The brand of anything you buy is always the want, never the need.
Having said that though, I’m sure all watch collectors like me will raise their left wrist and tell you that it’s much easier said than done. I’ll say it has to be done, nonetheless.
In addition, planning my expenditure goes a long way in not only helping me track recurrent costs but also helps me realize any leaks in my wallet in terms of unnecessary expenses. Therefore making budgets and keeping track of expenditure has helped me in saving more as well as knowing what to cut off. I found it incredible when I realized how much money I was spending on car maintenance-which was mostly for aesthetics. Regular but unnecessary change of alloy rims, or upgrading of the music system, plus a host of other accessories just for the love of the car. On realizing that, I made a reasonable plan on how much and when to spend on non-essential areas while at the same time not neglecting that lovely ‘lady’ I call Nissy (my car) but also spend my money wisely.
I’m also very credit-phobic! I try as much as I can to steer clear of loans. A couple of friends from the credit reference bureau as well as some personal finance consultants, though, have been trying to help me understand the difference between good debt and bad debt. I asked them to explain it to me like a two year old and they did: if the debt you are incurring is helping you bring more money than you currently have, that is good debt, if the debt you’re incurring is making you spend even more without any financial return, that’s bad debt. So I’m now trying to learn how to embrace the concept of good debt in my life.
Finally, YOLO! As one popular American rapper called Drake said. In the end you really have one life to live. So after following all these rules, I love to reward myself from time to time because this not only helps me feel like what I’m doing is worth it, but also keeps the bad money spending cravings at bay.
None of these make me a personal finance expert; far from it. If it’s true that it’s never too late to change, it’s even more so in the area of financial discipline. So let’s all go out there and do our best to use all our sixth sense to the most of our advantage.
About the author:
Jeff Mote is a radio presenter with Kiss 100, a successful voice over artist and an MC.