Can you manage your money effectively?

Do you manage your money or does your money manage you?

For some living from paycheck to paycheck is a difficult way of life, and often results in more month than there is money.

Money in Money out

When you do not manage your money properly this is what happens. Money comes in on payday and is gone the next day.

It’s how we are used to living, and still, sometimes do. Some months our family manages our money and others the money manages me.

The difference in these months is mine and my family’s fiscal discipline and whether we can resist the urge to shop for non-essentials.   It also depends on how well I stick to my meal plan and what surprises the school springs on us that weren’t accounted for in our monthly activity levy. http://kasheringyourlife.co.za/meal-plan-budgeting/

The unexpected

Unexpected medical bills not covered by our insurance, unexpected car payments (from an accident or blown tire) and how much the petrol went up that month also have drastic effects on our expenses.

Acknowledging that money rules your life is the first step in beginning to manage your money.  I have recently observed, that the people who manage their money, appear to have less financial emergencies than those who are living paycheck to paycheck.

The general consensus from the financial advisors is that you need to have at least 3 months’ salary in an emergency fund. http://www.thuthuka-sa.co.za/

To date, we have only managed this once and as soon as we got there, our roof needed replacing!

I also noticed that the “old fashioned” giving of tithes (10% of your earnings) really does seem to work.  A few people I spoke to before writing this article, said they faithfully give their 10% to charity and they appear to be able to make their money work for them.

This is not the money or items you give to the beggars on the street but to legitimate charity organisations.

Give time instead of money

For those who can’t afford the actual cash right now, try giving of your time or expertise to the cash value it would equal. It doesn’t work as well as the cash (never give more than the 10% unless you can afford to) but it definitely does work. http://kasheringyourlife.co.za/xmas-gifts/

Over the years there have been times where I worried that I wouldn’t have enough money to buy the groceries and then I would, sometimes begrudgingly, do something for a good cause and suddenly I would find just the right amount I needed.

I have now instituted a policy in my workshops, where I sell 9 tickets and then invite 1 person for free who I know would benefit from the workshop but really can’t afford it. http://kasheringyourlife.co.za/you-home-management-workshop/

 We and our money are in a battle of wills right now!  My family gets through the month – just. Trying to put away money to save for rainy days, my business and other expenses are where we lose the fight. It just doesn’t happen.

Sneak savings

So I have started what I call my sneak saving plan. I have a money box (piggy bank) and I have started putting my 20c pieces in. I know this will take a long, long time but I am determined. I have made sure that I can’t open the money box and will have to break it to get the money out. This will be done only when it is full!

What steps are you taking to manage your money? How much have you managed to save at any given time? Do you give to charity?  Have you got any other ideas or hints that might help us all?