Mike Bobby, a dear friend and an accomplished Entrepreneur wrote this article. It was suppose to be in my second edition of the magazine, before it (SMME XCLUSIVE MAGAZINE) took a plunge. We are back and will tell the stories until someone find our offering worth supporting. This is a good and must read.
With the current Economic challenges World-Wide there seem to be a new alertness regarding what we spend our money on.
I am sure that most of us are aware of the challenges we are faced with financially and would like to live like Mr. Jones next door but realize that we have to get control over our finances.
My writing is from a Lay-Man perspective and I have put together a short plan on how to STRETCH YOUR RAND and still live up to the Jones’
Warning: Please consult a registered financial planner or Debt councillor for professional assistance as the information given here is simply from an experiential perspective and is not a rule to the reader.
1) Know what you Owe and what you Own.
Make a list of your assets and liabilities because this is normally a good place to start at if you want to make a difference to your finances.
- Make sure that you know what you own and who you owe.
- Your list must be comprehensive (including your bicycle and car).
- You have to keep in mind that you want to get out of this rut of debt so you must know your financial well-being and exercise yourself to practice good financial planning.
2) Track-down every-single-one of your accounts (the ones you owe and what you owe)
- List them from least to greatest (smallest amount you owe to biggest amount you owe).
- Make sure that you calculate the full amount so that you have the total.
- See your debt as one account.
- Once you know what you owe and work a plan,your life becomes easier and you can now systematically reduce your debt.
- Pay the amounts as prescribed by your arrangement or installment plan and
- Pay the amount of starting to kill the smallest outstanding debt first and once you have paid up the smallest account,use that money that you paid on this account to tackle the next account up your list and so on and so on.
- Remember the extra cash is not for your consumption,but rather to reduce and eventually eliminate your debt.
- DO NOT GET INTO THE DEBT TRAP AGAIN.
3) Make a firm decision not to buy any-thing else on account. Remember you want to live better in the future so you need to deprive yourself of those unnecessary luxuries until you have overcome your debt giant.
- Minimize your expenses.The thing that kills our cash is unplanned spending.We know that we do not have the money to spend and yet we spend money on the spur-of –the moment items.
- Don’t be locked into contracts that you cannot get out of.
- Let go of the gym contract that you are not visiting anymore,walk or run as this will still save you some money.
- Eat out less and rather make your own meals out of magazine recipes(quite a bit of fun when the whole family joins in.)
- Plan your driving trips and start a lift-club or walk to your supermarket as this will do you good.
- Plan your grocery buying and look out for specials as they come around weekly.
- Do not buy what you do not need.
4) Telephones and Cell Phone(Salary Phones)
- Reduce your phone calls and rather use sms (Skype Video Calling is Free) or e-mail to communicate as phone bills can be quite high if you have verbal diarrhea.(Talking with-out Stopping)
- Get a pre-paid phone as you can control your calls. Different service providers offer different specials use them to your advantage.
5) Electricity and water.
- Reduce your electricity bill by switching lights off in a room that you do not use and every-time you leave a room switch the light off.
- Switch your geyser off during the day and only switch on when you get back from.
- Electricity counts when you leave it on over time. Cover your geyser with a geyser blanket to maintain the heat.
- Only fill your kettle with water for the amount of water needed as the extra water not used also consumed electricity.
6) CASH IS KING.
- Take back your life by putting a little cash away.
- At least 10% for tithe/charity,10% for yourself and work with the rest.
- If you have cash,you are in control.
- If you don’t have cash,some-one else is in control of your life.
The next time we talk we will go into recycling and waste management.
Regards
Mike Bobby
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