We should all strive towards being financially responsible. We have identified four key factors that make financial responsibility easy to achieve.
Learn to Earn
The key driver of being financially responsible is the capacity to earn. You cannot manage what you don’t have. Hence, it is very important that you build a channel to generate income. You need to harness your skills so you can have an earning chance.
If you struggle to earn enough, you need to look for ways to improve either by asking for a raise, learning new skills, putting additional hours of work, taking on another job or starting your own business.
Learn to Budget
The next stage after earning is spending! You need a plan on how to spend your earnings. The ultimate answer to managing how much you spend is budgeting. You need to set up your budget for what you need and also your goals.
Needs are the essentials for your day-to-day life which include housing, clothing and food. Goals are medium to long term financial targets you dream of. They include retirement, owning a home, vacations and education.
You can make a spreadsheet that can help you start budgeting. Once, you follow your budget religiously, you are on your way to being financially responsible.
Learn to Save
Saving money is the biggest of all the components of being financially responsible because it is the bedrock to good financial management. Having a good saving culture won’t only serve as a tool for reaching your financial goals but also as a good arsenal in case of an unforeseen expense or emergencies.
Your savings determine how fast you can build your wealth. It is also what determines your access to investment. Hence, it is important that everyone imbibes a healthy saving habit on their journey to financial freedom.
If you find you don’t have enough leftover at the end of each month to save, take a second look at your budget making sure you include savings as a line item under the necessities. It should be built into your monthly spending plan.
One great savings strategy is to attach a dream or goal to different savings accounts. Sites like Cowrywise allow you that kind of customization and tools to go public with your savings goals while you enjoy good returns.
Learn to Invest
The importance of investing wisely in building wealth cannot be overemphasized. Sound, smart investments serve as a tool to grow the money you earn in ways that outpace inflation and put you on track for retirement much earlier. Always try to read up on investing wisely on blogs and tabloids like Investopedia and Bloomberg, and make sure you ask questions about what you don’t understand.
Don’t make investment decisions because every other person is making them. Take your time, study every investment, ask professionals for help if confused because it only takes a slight investment decision to make or mar your financial journey.
Cowrywise offers seamless savings and investment tools; we would love to help you take your big investment step. Get started here and set up a plan that suits your financial capabilities. You are on your way to financial responsibility.
You can also contact us to get professional counsel, we would be more than glad to help.