Hello Hive and Leo finance Community, this is my first post on Leo Finance. I thought the community was still on Steemit, so I was posting on Steemit but I realized it has moved to Hive, so I am here on hive and I will be focusing a little of my time, effort and tokens on Leo finance. With this said, I will be writing my first post here.
Okay, let’s do finance
Becoming rich isn’t about making dollars and cents since a lot of people make this on a regular basis and most of them remain in the same position at the same spot. Becoming rich is about making the determination to sacrifice a lot of things so as to amass more wealth. So in this post, I will be giving a few lessons on how to cut down expenses.
I have met with a lot of people who make about 100 thousand bucks yearly but at the end of the year, they do not have 2000 bucks in their savings and do not have anything to their name, either a property or an investment. They spend all of their money on things that are luxury and showcase class. Actually, it is good to spoil yourself once in a while but not to make it a normal activity after the day’s earning. Being frugal most times will help, in fact, it has been proven that being frugal in most cases help to attain financial freedom easily (if you didn’t inherit wealth).
A lot of people have talked against frugality as they use the word cheap, stingy, money tight and so on, but the amazing thing is this people end up not having anything at the end of the day but in this post, I will be telling how to reach financial stability easily.
Organize Your Spending to 40-50% of your earnings
For a start, spending all or above your earning is a very poor way to live. Why get into debt you will have to pay with your next income because you had to use your credit card to get a Gucci Bag? I see this as an unwise spending, not because Gucci isn’t good but because you are getting into debt to buy it. The moment you are buying what you cannot afford, then there is a problem you have to solve very fast. You need to understand that in life, there are matters of emergencies and urgencies, and this matters often require money so what happens when you do not have anyone as backup? You need to learn how to spend money and spending 40% -50% of your earnings isn’t a bad start. You could decide on which of the percentage you are cool with or create your own percentage, depending on responsibilities.
Live on a Simple and Stress free Budget.
You cannot have a fix lock on the percentage you are planning to spend if you do not have a budget. Shoppers tend to buy more when they go shopping without a budget or a list. I have heard a lot of people say budgeting requires a lot of energy and takes a lot of effort but the truth is you can make your budget really simple. You do not need pages of lists to get a budget, you just have to get into writing, what you earn, what you are spending, what you are saving and what you are investing.
Track Your Expenses
Spending without taking proper note of what you are buying can be a very bad attitude. I have a friend who used to ask me a question in the past after spending all his income. He would ask “How did I spend the money?” and I will reply “Just the way you wanted to spend it”. It was when I realize he was getting worried about how money kept leaving his hands before I showed through tracking of expenses and this helped him a lot.
Cut the 20% eating 80% of the budget down
Just like everyone knows that 20% of everything and everyone controls 80% of things and people, that is the principle that works with your expenses. There is always a 20% spending that takes 80% of your budget and expenses, so you have to cut it down to a reasonable extent.
Conclusion
It is always easy cutting down expenses but it something that should be learnt by everyone as it is important in determining the financial success of everyone. This post is about helping with spending habits and I hope it was helpful. I hope to see you more on my blog, till next time.