How much will you like to earn, save, invest and give away this year' Hopefully, by the time you finish reading this you will be able to answer that question. By the way, I ended last week's article by emphasising the need to budget your money if you don't want to spend your life working just to pay the bills. That's what the Jonesses do and that's why many people can't retire on their terms. You've got everything to gain and absolutely nothing to lose if you take the time to budget your income. Having a budget is your financial roadmap and it's a proactive step in managing your money and creating the financial destiny of your dream. Having a budget puts you in the driver's seat and without being in control of the wheels, you don't control your financial destiny. Without having a budget which you stick to, you can't follow your money and without learning to follow your money, you don't control it. Not having a budget which you control is like spending money to build a house , fixing a door and not fixing a lock and key. It doesn't take a rocket scientist or a genius to figure out what will happen to such a house owner.Not only will he get all manner of unwanted visitors and gatecrashers. he's no longer in control of that property and it's only a matter of time before he discovers he's in a big mess. That's what happens when you don't discipline yourself to budget your money. That's what happened to former heavyweight boxing champion , Iron Mike Tyson. The former champion could chase down opponents in the ring and unleash those power shots and devastating hooks that sent many adversaries to the canvass, but ironically , Tyson never learnt to follow his money. That was a huge mistake and not surprisingly, Don King and co helped themselves to his money.But someone might say, I'm not making much, so there's actually nothing to budget or follow because my salary's gone the moment I get paid. There's actually the result of not following your money. It's not the bills that take your money away, it's your inability to follow it and send it where you want it to go ' be it to pay for the services you've enjoyed or for investment purposes. I was discussing budgeting with a client earlier this week and when I him how much he would like to save this , his response was all too familiar. It's what you hear from financial morons give ' something in the line of 'the money's all gone the moment it comes in.' That's the price they pay for not budgeting. So when exactly do you budget' Is it the day your salary comes in ' Before answering that, assuming you want to travel, when do you determine your destination' Is it when you get to the bus stop or the airport' Obviously not. If you determine your destination before leaving your house, why not budget your money before the money comes in' Ideally, you should have your budget in place before the money gets to your account. So when the money eventually gets in, you just allocate each amount to what it was supposed to do. Sounds easy as reading the first three letters of the alphabet - ABC. But it's not always easy, especially if you're just taking the first steps in taking control of your personal finance. Your first priority in budgeting are the three most essential things human beings need ' food, clothing and shelter. Except you're a model preparing for a catwalk, my thinking is that you don't need to buy clothes every time you get paid. If that be the case, the two things that get priority in your pay packet are food and shelter. Once those two are taken care of, everything else - apart from your health ' is a luxury. That includes phone and eating out.So let's say the money allocated for food isn't enough, what do you do' Does that mean you starve or deny your family food' Far from it. You can cut down on other things such as entertainment or the amount you spend chatting to your friend. Send a text , that shows you care. Who says you can't control your money'Although making a personal or family budget is easy, sticking with it can be tricky , especially if you're just developing the skill. But no matter the pain you go through in disciplining yourself to follow your money, the rewards far outward the regrets of watching helplessly as your money runs riot. Countries such as Ireland, Greece , Italy and Spain are feeling the ripple effects of not following their money. Majority of the populace in those countries thought the people in control of their governments knew what they were doing, but the high rates of unemployment and ballooning debts tell a different story. Interestingly, when the people woke up from their slumber, it was too late. What has happened on the national scale is just a bigger picture of what happens on a personal level when anyone fails to follow their money.One feedback I get so often from people is that there's not enough money, so there's nothing to budget. The truth is that it doesn't matter whether you make 4,000 or N10,000 a month, decide beforehand what and how you want to spend your money on before your employer credits your account with your wages. If you're having a deficit every month, that's a good feedback and a measure of your money intelligence. Getting regular feedbacks is actually one of the biggest advantages of having a budget. You can see the picture every month when you get overdrawn or have extra cash . If nothing else, remember a budget gives you instant feedback. It's analogous to standing in front of the camera or mirror. You can see what's not right about your image straightaway. So, if you're having a budget deficit - if you're spending more than you earn - every month, It means you need to generate more cash or cut down your expenditure. As for me,though, I prefer eating my cake and having it. What that means is that I'll opt to generate more income and at the same time find some creative ways to lower my expenditure. Let's say you've been having budget deficits all through 2011, what do you do to get yourself out of the hole' How do you generate more income' You take a second job or provide a service that people pay you for. You may have to become a laundry man or janitor to make more money. Whatever it is you have to do to have a budget surplus - remember the Nike advert ' just do it .Oyedoyin, the CEO and founder of Money Intelligence Coaching Academy is on www.moneyintelligencecoachingacademy.com and can be followed on twitter @TOyedoyin
Click here to read full news..
