A long time ago during a bible study class in church, the priest was stressing the importance of members paying tithe, at some point during the class he asked the question “Why do some members fail to pay their tithe”. A man sitting at the back of the church who had been listening attentively answered. He said for him he doesn’t pay tithe because God gives him 50 thousand and then gives him a problem that will cost him, more than 50 thousand to solve, so since he doesn’t have anything left on him there is no way he can pay tithe.
This is not a religious post or a post about paying tithe, it is just to illustrate to us that some people spend more than they earn and if such is your case then it will be very difficult to invest your money not to talk of growing it.
When countries spend more than they earn they print more money so that they can spend more, however, this action has a negative effect on the country as the value of their money diminishes. It is different for individuals, when we spend more than we earn we can’t print more money, you go bankrupt and fall into debt.
A wise person invest more than they spend, so here are some ways you can spend less and invest more:
Understand How Much You Earn Monthly : - A lot of people don’t know how much the earn monthly so for them they have an open ticket to spend as you like. If you know how much you earn monthly then you’ll know that your spending has a cap limit.
Have A Spending Plan : - You need to figure out what you are going to be spending your money on, that way you determine on time how much it is going to be and start cutting out those things that are not necessary and things you can do without. This will help you stay within your earning range as you know you can only spend what you have.
Have An Investment Plan : -These plans comes in different ways, some calculate it as 70-20-10 or 60-20-20 or 50-40-10. What these figure boils down to is the first part is living cost, the second part is for investment while the third part is left as reserve in case of an emergency. Using the first example 70-20-10 it means 70% of my monthly income is used as living expenses, 20% is invested while 10% is left in savings in case I need it for something that wasn’t planned. What I have discovered is that you choose the ratio that works for you based on you stage in life. A fresh university liver that just started working can’t have the same investment plan as a family man with 3 kids.
Stop Habits That Don’t Add Value To Your Life : - Are you an excessive smoker? Do you drink too much? Are you a glutton? Or are there other harmful habits that eat up a lot of what you earn and they don’t do you body or health any good. While I can’t tell you to stop them out rightly, but reducing those activities can really help you spend less and invest more.
Look For Cheaper Alternatives : - One thing some people don’t know is that something been cheap doesn’t always mean it has less quality. For instance, we process our own grinded ginger and spices which ends up less than 10 times the price we’ll get the packaged ones at the super market, on top of that the quality is far better that the packaged ones. There are so many things like that including your choice of place for a vacation. Cheaper alternatives can leave you with a lot of free money to invest.
Sell Off Stuff You Don’t Need Or Use : - A lot of us have loads of stuff we barely use or have need of or have no need of them again. Why are you keeping them? Why not have a garage sales? Some times in the past we buy things due to the marketing that comes with it or the color or sophisticated looks and at the end of the day it is kinda useless to us, we can’t throw them away because of the money we remember spending on them. Lol. We pack them and dump them in the basement. Let them go, allow people that will use it get it and will make some money off them.
Look For Bargain Prices, Offers And Coupons : - Buy 2 get 1 free!!! I believe we are used to such promos especially during season sales. Or buying stuff and getting coupons that give you a discount on other purchases. These are great ways to free up more money to use for investing.
In conclusion, I can go on and on but we all wear the shoe and knows where it pinches us the most, develop your own ways to manage your income so that you can invest more for the future.
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