Commit to tracking your expense
Have a budget and stick to it
Invest your savings
Diversify your income stream
Track All Your Expenses
On this Chidinma had this to say:
“I’ve come to understand that the reason why most of us spend a lot of money on “unnecessary things” (like that 30th pair of shoe you really did not need, or the 1000 dollar Jersey you could have done without) is because we don’t track it. Hence, we end up not really knowing the volume of money we spend on these things.”
To help with this, she suggested using a mobile app called Expense Tracker. The app shows you at the end of month/week/day how much you have spent. Tracking your expenses helps provide an accurate picture that can guide your budget planning, and that leads us to the second tip.
Have A Budget And Stick To It
No two persons can have the same budget, because our lifestyles, dreams and spending patterns are different. So you need a personalized budget. On drafting a budget, the following steps were suggested:
Come up with a comfortable percentage of your income for savings and investments (10% should be the minimum).
Make a list of what you spend daily and the typical amount you spend on them (see why tracking is important?)
Separate your list into wants and needs — day to day necessities.
Reduce your list of needs to fit your budget size — after savings and investments — and allocate the remainder to service your wants.
A simple rule for budget planning is the 50:30:20 rule; 50% to needs, 30% to wants and 20% to savesting.
Invest Your Savings
“Don’t just save, make sure your savings are invested; and make sure funds are separated for that before you start spending at all.”- Chidinma Okoli
Investing your savings helps preserve the value of them over time. With cowrywise this is quite easy, as making savings and investments happen simultaneously.
Diversify Your Income Stream
Diversify your income stream especially by taking up remote jobs. As a young person it’s great for you to start investing aggressively and that can only get better with multiple income streams.
With these brilliant tips we do hope that you start to put your financial house in order.