• December 14th, 2019

Social Reflection - From broke to Money Savvy...financial literacy 101 - spending



I came from a place where one week after I had been paid I was fabulously broke. I mean broke enough to have to call on my savings account, broke enough to have to call daddy dearest one week before payday and I must be frank and honest, I was tired of living paycheck to paycheck. I soon became the friend you could not invite out in the middle of the month, because truth be told, I simply could not afford to attend. The invites dwindled, and I became drenched in dread living day by day. 

I wondered, was I not making enough? Did other people have incomes that simply did not match mine? How though, if we are all starting up in our careers? I felt like something was not adding up, literally. I later decided to try to buckle up and get my finances in order. I hated every second of it because it meant I had to face the one area I opted to turn a blind eye to for a long time. 

Let me walk you through my financial journey, but I must be honest. I am no financial guru, I never studied finance, I simply have applied some basic skills that have taken me a long while to perfect, but they have been very effective. I’d like to do a 4-post series that will best explain the methods I used. This is to ensure we take it one slow step at a time. There are three steps we will take, so this serves as an overview;

• Track Your Spending
• Draft a Budget
• Open Savings Accounts

Apply lessons

To get started, we need to first get an understanding of what you spend your money on. 

Track Your Spending

Understanding where your money goes is a fundamental part of getting to a place where you can control your finances. It requires being brutally honest, and only then can one get a clear picture.

Activity

Write Down on an A4 paper everything you remember spending money on in the last month to date. This can be something like airtime, movies, food, taxi, petrol, take-out, clothes, toiletries, entertainment, etc.

Write down how much money you spent on each item. You are allowed to approximate because this activity is simply to get a rough idea of how much money you are spending and on what. 

TIP: Use your online banking app to track expenses or your bank notifications on your phone. 
Take another A4 page and categorise your expenses. 

SUGGESTIONS:

Fixed Expenses - Rent, water, medical aid, electricity, etc.
Entertainment - Movies, dinner dates etc.
Lifestyle  - Airtime, Nails, Hair, Clothes, etc.
Savings  - Money saved 

Sum up your expenses in the categories and take note of where the majority of your money goes.
Note down your income. Additional income should be noted as well.

The idea of this exercise is to get an understanding of where your money goes. Are you saving nothing, while going to dinner parties every week? Are you spending too much money on lifestyle and cannot maintain your day to day expenses? Are you always broke before month end and broke again a week after?

Not to worry. The idea is to get your finances back on track right? We will take it one step at a time. Come back again next week and we will be sure to get the next step going. 

See you next week, same place as we journey you towards becoming money savvy. You gonna be alright.
With Love,  Mavis

*Mavis Braga Elias is a civil engineer by qualification and a marketing officer by profession. A philanthropist at heart and founder of the EM Love Foundation. She won the Vivid Philanthropist award in 2015 and the Queens Young Leaders Awards 2018. Find her on Twitter- @mavisbraga or email – eliasmavis@gmail.com


Staff Reporter
2019-05-29 10:33:20 | 6 months ago

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