Financial Intelligence: Are you a good steward of your money?

Both my grandfathers were headmasters.  I never met my paternal grandfather but one thing that my maternal grandfather – and for that fact grandmother as well – never got tired of drumming into our heads was the important of education.  I have always interpreted this to mean both formal and informal education.  My definition of informal education is learning from the lessons that life presents to you.

One such lesson lies in the importance of saving and having realistic financial goals.   The truth is you don’t have to be earning millions to start.  In life i believe it is always the first step that is the hardest and therefore the most powerful. It is important to start where you are.  The rule of thumb is always to save 10% of what you earn whatever that may be after your tithes and other obligations.

I am passionate about women being financially intelligent because I find it upsetting when we can spend eye-watering amounts on our hair, make up, shoes and clothes but not put a cent aside for a rainy day.  Please don’t get me wrong, i want to look good like the next person but as my dad always says, “All those things will never end, so sacrificing ‘shopping money’ in order to start putting away money for investments; your pension etc. seems like a small price to pay.  Life really is about reaping what we sow…”

Below are some principles that I apply to my life:

  • Tithing – there is something  powerful about giving back to God the first 10% of your income – Malachi 3v 10 -12
  • Take the time out to prepare a realistic budget ( see article on budgeting)
  • Save at least 10% of your income every month
  • Have a rainy day fund which should be 8 times what your monthly expenses are.
  • Pray and work towards having multiple streams of income.  Now for everyone this may be as simple as taking the time out every couple of months to de-clutter your home and sell things you may not need anymore.  Seek God to show you what else you can do to bring in extra cash.
  • Set savings goals. Establish what it is you are saving for exactly. For instance, if you would like to buy your first piece of land in the particular area of town, and you’ve done your research, you can pretty much give a ball-park figure of what it will cost you to buy that land per square meter. Maybe you are working towards the purchase of your first car. Knowing that it will cost you $5000 to buy the car and another $5000 to get it shipped over, coupled with the dreaded duty costs – you have figure in mind that you need to work towards. Your target is $10,000 and it will cost you X amount to save it. Creating a goal, or reason for your saving is important because it gives you focus.

I heard a very sad but common story about a woman whose husband died in a tragic car accident and left the family with nothing but debts that sadly she was unaware of.  What makes this situation even more painful is that for the better part of the last 10 years the widow was a ‘kept woman’ who allowed her husband to handle EVERY single aspect of their finances, to the extent that on the day that he died because he handled all their finances and gave her an ‘allowance’ all she had to her name was $10…

She is now finds herself in a situation where the family has no vehicle as it was a complete write off – and that was the least of the struggles that ensued. Said lady had to endure the task of getting up to speed with what it was that the husband was doing to get them into debt, reading the fine print on paperwork signed and trying to keep her head above water in every way.

It gets even testier when there are children are involved. Was there any money aside for their school fees? Was the house they called home at some point put up as collateral for one of the many transactions the husband was involved in? She was a ‘kept woman’ – but did she have any previous experience she could ride on to get back into the work force or continue on with the business that her husband was running? I never got wind of the answers to those questions, but do imagine that had she been better prepared, perhaps after this life changing tragic event may have been softened.

Ladies, we have to be shrewd about issues of finances. I know people who borrow about town so they can serve a nice roast chicken for dinner every day or keep the pool full. As we know all too well – life can throw some hectic curveballs that often times leave us realising just how unprepared we were. Are there wiser decisions we can make with our money? Are we being good stewards with the money that passes through our hands and our books?

Quintessentially Yours

QF Ruvimbo

One Dollar At A Time

So you’ve been working for roughly five years post graduation from your first degree and in the big scheme of things on a scale of one to ten in your opinion, you would rate your life as a healthy 7.  You give yourself a pat on the back, look up to Heaven and blow kisses to God because had it not been for His Grace and Mercy…this story would have had a different ending.  Great you say.  So on your commute home, you are flipping through the Evening Standard and you look over your shoulder to a fellow bright young thing sitting next to you.  “Nice shoes”, you mutter to yourself as you get back to your paper. You soon after overhear snippets of her conversation

“Pension…started right after Uni…rainy day fund.”

Naturally being the alert twenty-something that you are, you forget your article and start musing to yourself…”mmm I wonder how much is in my bank account?  Gosh I don’t have a rainy day fund.”  As all these questions race through your head, you are ashamed to say that your line of thought was more along the lines of “mmm can’t wait to get that pair of shoes, and I need to call Mary to book an appointment for my weave Saturday afternoon…” You get where I’m going with this right.

How many of you young ladies out there who are working it in your different professions have ever really thought about any kind of financial future.  Be it starting to contribute to some sort of pension fund, saving a percentage of your monthly income, or dare I say it pay off those credit cards.

Now don’t get me wrong I love looking fierce like the next woman out there but I believe that now more than ever in an age where we are inundated with information on financial literacy, it is a crying shame to not take appropriate steps to working out some sort of financial plan for your future.

This wake up call is not intended to make you want to crawl into a corner and hide but cause you to at least take a breath and locate yourself where your finances are concerned. The result should therefore be to start making the appropriate changes to your financial life.

The bright young thing engrossed in her paper above was me several years ago, and truth be told it’s many women out there who are going through life ambivalent about their finances. It’s time to empower yourself ladies and change how you view money…One dollar at a time

Outlined are ten points I would like you to consider

As a woman of God I believe it is important to tithe 10% of your income and give offerings as a form of obedience and gratitude to God – Malachi 3v10-12

After your tithe it is important to put 10% of your gross income in a savings account

To create some semblance of structure in how you spend your money, it is important to have a budget.

Set financial goals that encourage you to be disciplined with how you spend money

Research pension funds that you can start contributing an amount that you can afford

Live debt free, if you do have debt. Take a minute to sit down and work out exactly what and who you owe. Once you have done this work on paying your loans off.

As much as is practical use cash. Always using your Debit card means that you can easily blow the budget without realizing it.

Be honest about your spending habits. If you find that every month you feel the need to treat yourself with some item of clothing, pair of shoes, hand bag etc. Force yourself to have a spending diary so you see where your money is going.  As you self-analyze consider why you feel it’s necessary to always shop. Could this be an addiction?  Can you go a month without treating yourself?

If this is the first time you are actually facing the reality of your financial health, find someone you trust to confide in to encourage and motivate you to be committed to changing your relationship with your finance

Finally exhale and smile. You are taking steps to empowering yourself

This article is the first of many to come as we explore all things financial.

Quintessentially Yours,

QF – Ruvimbo