How To Become Financially Successful With The Money You Have Now!
Make your money work for you on your terms
It’s time to start making your money work for you. Don’t let its power enslave you.
Even if you are financially happy, there is always room for improvement. If you’re financially unstable then it’s imperative to make changes.
Many hard-working people find themselves entangled in a cycle of financial struggle, some worse than others. They may need to borrow money (yes credit cards aren’t your money) or they are chasing their monthly paychecks.
This cycle will continue for many years unless it is faced & actively stopped. It not only robs financial freedom but it causes stress & anxiety. The frequency it produces signals more money problems which may come in the form of unwanted/unexpected costs leading to heightened worry & possibily debt.
I’m going to share 4 crucial financial steps I’ve learnt & applied which have definitely made positive changes over the years.
As a result of applying these principles I found together my husband & I were wasting a variance of £600 — £1000 per month (taxis, work drinks, dining, memberships, unused TV subscriptions, clothes, coffees & random purchases) & with these changes together we saved with the goal to take a sabbatical for 6 months while still enjoying life & creating great memories. In fact we never went to more concerts than we did in that year & our sabbatical & new financial habits led us to moving abroad and setting up a business!
Whatever your goals may be, if they include finances, it’s time to talk about how to make your money work for you.
#1 Analysing Your Income & Expenditure — this is the most important starting point. Make a spreadsheet of your monthly income. Then list all your expenses;
- Mortgage/rent
- Utility bills
- Insurance
- Banking fees
- Grocery shopping/Household products
- Dining/take aways
- Child care
- Gym membership etc.
List every single cent even the odd random stop-offs you may do. Then subtract your expenses from your income and see what you are left with if any. If it is a minus or less than a 3 digit number then you definitely need to think of where you need to improve.
#2 Create a Budget and Stick To It
Now that you’ve analysed where your money is going, write down a new weekly & monthly budget. For example, if you spend say £3000 a month on everything, Write a lower amount that you are now willing to spend. It may seem impossible to lower it but it really isn’t! Writing increases the frequency of a goal happening by 43%. Take that pen and write it down.
#3 Reduce Your Outgoings - Next, think about what you can live without or reduce. Ask yourself a series of questions. Are you spending a lot on morning coffees? Are you buying a lot of snacks? Are you paying for a membership that you don’t or rarely use? Are you paying for a TV streaming service & only watching 3 out of the 400+ channel options as well as paying for Netflix? Are you paying a huge amount on gas & electricity? Choose to either replace these expenses or cut the ones that aren’t essential.
If you’re not using a membership then stop paying for it. If you are spending a lot on snacks/coffee etc. find more cost effective alternatives such as buying multipacks or alternative products that are going to help you save.
Scenario:
Some people spend up to £10 per weekday on coffee & lunch while going to work. This is £50 a week, an average of £2600 a year.
Then a gym membership of £24 a week, this is £1248 a year.
Now imagine that same individual always runs late & gets a taxi at least 3 x a week of £25 per ride/£75 a week, that is £3900 a year (that’s just unnecessary). Then there’s the random snacks a few times a week from their local store of an estimated £9 a week, that’s £468 a year.
With changes this individual could save £8,216 a year if they cut these out or £4,108 if they just halved their spending and found alternatives.
Now picture this over 10 years, that’s a financial saving of £41,080 – £82,160. In 40 years that’s £164,320 — £328,640. Without actively changing these spending habits that’s a huge financial waste that could’ve accumulated to a great saving!
#4 Final Step — Write Down Everything You Spend
Now that you have your spreadsheet, your new budget & plans to replace or cut expenses, it’s time to apply this. Create a note on your phone & write everything down that you spend even if it seems like barely anything.
Money is money, it all adds up.
At the end of the week add the figures up and see if it will equate to your new monthly budget. Remember what your goals are, if your weekly spending balance isn’t going to achieve them, then think of how you will in the next coming weeks.
At the end of the month, add up your expenditure & whatever you have left put this in a saving or ISA account. Do this each month & if you stick to this you’ll be surprised with how much you’ve saved!
Bonus Tip — if you are someone who has a habit of buying things and not using them then make sure you return them within in the permitted timeframe. Don’t waste money on things that sit collecting dust. If that time period has passed, then sell it, that’s what sites such as eBay are for. Don’t hang onto things you don’t need or want.
Make your money work for you!
Thanks for reading & hope you have a better financial year ahead!
