HAVING A FINANCIAL PLAN

Folks I must apologies for my slow start into the new year I can only attribute it to the need to retreat to re-fire if you know what I mean!

Anyway, I stated in my last write up that you  need to have a financial plan for your self this year. many of us just allow things to catch up with us without deliberately planning for our finances. the need to plan for your finances cannot be overemphasized.

in the first place you are not in absolutely in control of all the factors that will affect your life this year so it makes sense to reduce the unforeseen to the barest minimum via planning. Furthermore, planning you finances helps you to allocate resources well ahead of time preventing waste and impulsive spending.

The first step to financial planing is to have a year's budget broken down into monthly budgets. In the past I have spoken on what ought to constitute a monthly budget but suffice it to say that a repetition will not be out of place here.

In your monthly budget there are certain keys issues that must be provided for. They include but not restricted to the following:-

1. Food
2. Rent.
3. Bills (Electricity, water etc)
4. Transportation or fuel
5. Consumables - soap, sanitary items etc.
6. School fees
7. Clothing items - especially for those living in cold regions.

Every other thing will be an addendum depending on availability of funds.

Now the sum total of all the monthly budgets over 12 years constitutes your year's budget. Now the total will be the minimum amount you need to earn to cater for the needs of your family for the year. Next you need to ask yourself if your present income can match or surpass the year's budget. If it can then all well and good otherwise, you will need to find out how to augment your income by taking a second job if possible or doing what is called side hustle.

In any case your year's budget tells you immediately if the present state of your family income pooled together can meet the basic needs of the family.

If you want to embark on some project this year, then you will need to plan on how to raise the funds through savings or securing a loan. I will advise that it will be better to save up for a project than to take a loan that will further deplete the amount of money available for you to spend when ypou start repaying the loan plus interest except you and your family have decided that in other to do the project you will scale down on some essentials.

Next time will look at how to fund projects without borrowing!

God bless you.

Femiimevbore@gmail.com
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PROBLEMS OF MARRIAGE 7

                                  Monthly Budget

                          One of the challenges that many people face is the temptation to spend money as they earn it. The impulse to start buying once cash is available is always there. I know a lady that collects her salary and will finish spending the entire salary in one day of shopping. This creates problems and make one live above his or her income.

                          Preparing a budget before your earn money is a smart way of ensuring you do not overspend or spend money in things that you do not need. In the home this is very essential because you will always have situations where there are many needs contending for limited resources. So you cannot afford to indulge in impulse spending.

                           Agree that you will always operate a monthly budget and be willing to jointly implement it. No matter how busy you are, try and plan your expenditure. It will help you against impulsive buying. Agree that the money you make belongs to both of you. It is not “your money” or “my money” but “our money”. It belongs to the family and because it is jointly yours, the two of you will decide on how to spend it together. It is amazing today that there are women who can give their bodies to their husband but not their monies. Also, we have some men who can give their hearts to their wives but not their pockets. If you agree that all money made belongs to the family, then, the planning won’t be difficult.

A budget is simply a statement of how to spend your income. Have a list of items you want to spend money on.  Items that must be top priority on your budget, should include for example, house rent, food, transportation, utility bills like water and electricity, education, telephone, mortgage for car or house if you have any, clothing, holiday, etc in that order. Allocate money to the relevant items you have on your budget. With experience you will perfect your funds allocation. This is your first step towards financial planning. The money for food goes to the woman. She too should have a budget for food. You may also need to include your extended family in your budget. Remember that those who fail to plan, plan to fail.

Except you adopt budgeting “your take home pay, may not take you home.” In your budget you must make provision for savings. You must allocate to saving at least 10% of your basic monthly salary. Well, if you think you cannot afford to save10%, try 5% or even 2%. The idea is just to ensure that you cultivate the habit of savings. As your income grows you can begin to save more than 10%. What do you do with your savings? You invest them; this is the key to your financial freedom.

                          Your budget should be all encompassing and you must not forget to budget for miscellaneous or exigency. Some people have the habit of excluding some vital things in their budget. Some parents for instance would not think of their children’ school fees until January. It is then they will find out that their January salaries cannot pay the school fees. That’s why so many children school fees are paid late. Make adequate preparation for it through regular savings.

Before I began to save money, I had two children in nursery school and could hardly pay their school fees as at when due. Imagine nursery school fees! But as I began to save towards it, it became easy to pay and since then, I have never delayed payment of school fees again.

If you budget your expenditure with your spouse, I see you facing less financial quarrels and having a more peaceful marriage.

   Femi Imevbore
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femiimevbore@gmail.com
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