How long have you been avoiding dealing with your money? I don’t mean everyday stuff like spending it, paying bills and stashing some away in a savings account.
Avoidance looks like something I used to do not so long ago. I would go to the ATM, withdraw money and decline a receipt. I didn’t want to deal with the balance statement.
Many times I wasn’t even sure that the machine would even spit out the money in the first place. Some of us can relate.
RELATIONSHIP WITH MONEY
So what does it mean to deal with your money? Think about it like a relationship. There are ups and downs but you are still in it. You learn a lot along the way about a person (and yourself) as you spend time with them.
It would be hard to have a relationship with someone when you don’t know where they are. Do you know what you are spending money on? You can have the grandest of plans but if you do not have a grasp of this, they will not materialise.
I don’t also mean a budget. That’s a great planning tool but it doesn’t bring the awareness we are after.
Track your spending as it will reveal your habits – the good and the bad. Things like what the drinks you randomly go for after work actually cost you, daily newspapers, lunch, parking fees, impulse spending, etc.
Once you know, for example, how much you spend on entertainment, you will make a decision on whether you are happy with that amount or not. If not, you will become very intentional about it.
You are now officially dealing with your spending. You also stop avoiding your balances like I used to do.
Get to know how much money you have, whether it is in the bank, Sacco, land or shares, and how much debt you have. Now you truly know where your significant other is.
It is scary to do and most people avoid doing this but nothing can happen until you are clear on this.
The next step is coming to grips with the work that has to be done. Many would rather hope that a magic source of money will appear. That’s not going to happen. The same way in a relationship you soon understand that you did not get the perfect mate and neither are you.
IT TAKES WORK
A lot of work has to go into making this relationship work. If you did the first exercise you will start to see where you are being wasteful and can cut down.
However more of the work will be in building the foundation for you to achieve your goals.
You will find that what you have may be quite far from what you need so you will need to be engaged in this journey.
Nobody will resolve this for you; you need to constantly come out of your comfort zone and continuously ask yourself what you will do about it.
What will you do to earn more money next year? What will you do with that idle plot of land so that it generates revenue and can fund your retirement? What will you do with your business so that it can deliver more value and be more profitable?
This is truly the essence of dealing with your money as you are taking responsibility. Yes, many external factors could always be better and help but these are your goals, right? The more you delay doing this the more inadequate you will feel about your ability to handle it.
It is hard to connect all the dots forward, have all the answers, know how it will work out but it is really a day, a step at a time.
Start the business, save more, make a new investment, take your chama seriously, etc. Commit to being a student and learning as you go along.
Try and fail fast. Be open and honest with those you need to be. Don’t hide behind perceptions as you kill your dreams. Ask for help when you need it. That’s dealing with your money.