1. Know yourself
Knowing yourself can save you money! Yes it can. I see people breaking their bank just because they lack an understanding of their values and priorities. How you spend money is a reflection of what you value. I for one value experiences more than ‘things’, don’t get me wrong, my dream is to drive a Bentley one day but for now, I have to choose my battles i.e. building a business, investing, child’s education and experiences ect.
So write down your values and put them against your budget. This will tell you what you value the most. When you do this, it’s easier for you to not try and keep up with the Khumalo’s next door. Know thyself boo.
2. Just Start
We all know, the earlier you start, the better. Starting early with investing is key to building wealth. Find a good Asset Management company to invest with and start your journey to wealth creation. Compound interest makes things that more interesting when you start early.
You do not need tons of money to start, from R500 p/m you can start with either a Unit Trust or an Exchange Traded Fund and build from there.
3. Don’t inflate your lifestyle but don’t starve yourself either
Most people tend to inflate their lifestyle with every pay increase, nothing wrong with that BUT building wealth requires you to keep your expenses low and invest what is left. I call it the middle class syndrome: the more I get paid, the more I will consume; get a bigger car, move to a bigger house. But these choices do not give you freedom, ever. It is still living from paycheck to paycheck.
Building wealth doesn’t require to starve either, much like a diet, if it’s too strict, you will probably end up eating ice-cream in the middle of the night! Like I said, choose your battles and be smart about your money. If you can afford a R5million house, that’s great, but can you buy a R3million house instead and invest in a high potential business and make more later? It’s all about opportunity cost and giving yourself options in life.
4. Stop scrolling
I have been a victim of scrolling way too hard and too long on Instagram. You see other people living their #bestlife and we forget that sometimes it really is just about the ‘gram’ , nothing real, just staged. So now I follow Instagram accounts that inspire me to build my own empire. Also, my advice: if you have a service or product that you can provide, why not use Instagram for business purposes for your side hustle and make yourself some money? You need to leverage social media to your advantage to earn yourself extra money. Stop being a spectator to other people’s lives, you have so much to offer too.
5. Educate yourself about how money works
Every woman must at the very least, know the following concepts about money and how they work:
- Interest and Compound interest
- Assets and liabilities
- Net worth
- Credit score
- Investing and risks involved
I know the ‘advice’ is not very traditional but nothing stays the same, we live in a world where things are changing, your financial journey must change and adapt to the different times of your life too.
What financial advice or tips do you like to give or live by?