By Edmund Kamugisha
If you are anything like me, you will remember the days when you were growing up and you would ask your parents for something and they would ask you to wait a day or two. The “delay” would sometimes go beyond a week and in some cases, you may still be waiting for what you asked for till this very day.
We were not poor by any definition. My Dad was (still is) a career Finance professional and my Mom was (still is) a fashion designer, trainer and all-round hustler. But my fascination with anything I really wanted made me learn how to save my weekly transport money at a steady rate just so I could buy sweets and pancakes (aka Kabalagala) from the lady at the corner.
The various replaceable words for hand-to-mouth include Balancing Act: Taking something in your stride: Keeping your head above water and my favourite is >>living to fight another day<<. Whatever arguments one may have, the situation in any economy that you live in warrants a phase in your life whereby your expenses seem to always outlive your incomes and you find yourself literally living from hand to mouth.
So my discussion today and fully overdue revolves around finding ways to beat this situation.
Many consumers seem to lead a hand-to-mouth existence: they simply consume their current income. This may be the result of simple but shady spending habits, or the reflection of an inability to take some risks in investing in a side business or worse, purely not trying anything to increase their earnings.
Before the end of the day, it should be known that either married or single, with or without children, your spending habits will always reign supreme when determining whether you will beat the hand-to-mouth situation. So when the going gets tough, how long can you survive before you have to call for Government hand-outs?
In my country, the need to build a family home often distorts our financial planning (if it is done anyway) and with it a huge dent in our monthly earnings and in many overall cases makes people live beyond their means. This basically implies many of us are one pay cheque away from a disaster.
Why do so many households find themselves in such an extreme financial position, whereby most of their wealth is tied up in il-liquid, costly-to-access assets?
Asking yourself this question will help you seek practical ways to handle your planned growth. In my view though, getting out of the rat race is a steady marathon. You and I will always have bills to pay for the next foreseeable future and finding crafty ways to ease that burden are where I want to concentrate.
- Watch your spending patterns? Do you get trigger happy when a certain expected or unexpected windfall occurs? Do you feel the need to splurge? If so, get over it by doing it. Use the opportunity to get it out of your system. The back to square one scenario will shock you to not be phased by the next windfall. Having a basic budget that is followed regularly can help champion any spending pattern anomalies
- Learn to automate some of your transactions. Utilize an affordable standing order to transfer your own savings amount before any eventuality comes up. This way, you pay yourself first. I deliberately did not mention savings because i assumed that at this point in (y)our lif(v)e(s), having some form of a rainy-day fund would be paramount. If it is not, it is never too late to begin.
- Share your financial plan with your spouse and deal with it on a two-pronged attack format. This may seem alien to some, but welcomed to many others. If you are both backed up against each other fighting the world, it would be nice to know how much artillery you can both muster at any period in time.
- Probably the most important, learn to take a risk. Be it real estate, money-lending, or any other form of investment decision you make/ take. This will help you as you grow older and have potentially more money to make larger investments
- Educate yourself about what life is like after you have added all the value you can at your workplace and the time for you to be replaced comes up. What did you plan for after leaving formal employment?
The tips though rudimentary are not planned to be short-termist in nature, but medium to long-term as the hand-to-mouth predicament never seems to go away entirely, but it does stretch longer if you have a plan that can always be re-aligned as and when circumstances force you to.
You can follow him on twitter: @edmokmg