How to Invest Collaboratively with Friends: Tomie Balogun
[bctt tweet=”When you invest with others, you take advantage of the power of many – @tomie_balogun” username=”SheLeadsAfrica”] As a certified financial educator and Instructor, Tomie Balogun has a lot of experience in investing with friends. While pursuing her MBA, she and a few classmates started an investment club. Their passion to achieve financial freedom and make an impact on society saw them successfully invest in various small businesses and assets. However, investing with friends hasn’t always been that easy. Like Tomie, many people have had bad experiences either loaning money to a friend or requesting for a loan. The conclusion: money and friends are a horrible mix! However, the question many ask, is it still worth investing with friends or anybody else?. Tomie gives us tips on how to make this work. The Power of Many Think about the way you ask more people to contribute money to a party, so everyone can have more food options. Investing with other people helps increase the number of resources you raise and strengthens your financial future. Investing in Bigger Things Co-investing in an investment club gives you the opportunity to invest in bigger opportunities, share risks and share higher returns as well. For instance, while real estate is a great asset class that always appreciates, not a lot of young people can invest in it. However, if 5 or more people decide to come together and invest, they will have more cash. Over time, they can earn returns from their initial investment and continue to flip multiple real estate deals. That’s a better option than waiting till your 40’s to eventually own real estate. Choosing the Right Team You might be thinking, co-investing or starting an investment club is great but what about the emotional issues that come with investing with friends or colleagues at work? This can be tricky! The first thing you need to do while selecting partners is to avoid sentiments. You need to make sure that you choose your partners with clarity and objectivity. When identifying people, choose partners who are disciplined with spending money and more importantly, have a strong sense of integrity. Shared values are very important when co-investing. Details, Details, Details! First, you need a legal structure in place to protect everyone’s interest. When this happens, you limit liabilities in investment deals. You can register your club as a limited liability company or a limited partnership. What’s important is to make sure you have the papers to support your words if things go wrong. Secondly, they say the devil is in the details. In creating your legal documents and other admin paperwork, make sure you don’t skim through anything. Practice good financial bookkeeping, assign roles to manage tasks and create a constitution! Remember all information can be important! Make that Money Work Once you sort your membership and legalities, you can then start contributing money. Don’t set unachievable contribution rates, but set goals that everyone can work towards. If everyone believes in the goal, they will eventually build it too. At the end of the day, there are many options to invest. However, investment clubs are both great for collaborative investing and also fun! They are a smarter way to take advantage of the power of many to achieve your wealth goals sooner. So as soon as you can, get your motherland moguls into formation and start co-investing together towards your financial freedom.
9 Business Lessons from My First Year of Business
Like many people, I was faced with the dilemma of deciding whether or not I needed to attend business school to start my business as I had no experience. However, I finally decided to be brave and start my business without any experience. In my one year since starting, I have learned the following lessons. 1. Never take things too personally. When operating with people, it’s often very easy to make arguments, criticism and other relations personal. However, if you want to succeed in the business world, you need to remember that at the end of the day, how you deal with your customers and partners is strictly business and not personal. 2. Separate your business life from your personal life. When you have a friendly relationship with your clients, it is very easy for the lines to get blurred. Sometimes, this can end up in sticky situations where one party does not fulfill their end of the deal. To avoid these situations, it is important to set the lines clear between your business and your personal life. You need to maintain a work-life balance. 3. Be clear about your job description. As a service based business, one of my ethos is going beyond and above for my clients. Sometimes, this results in taking up certain duties (aka unpaid labor) that are not part of my job description. This can get overwhelming. Therefore, it is important to be clear about ALL the services that your offer from the onset. If necessary, you should draw up contracts that reflect your services and your limits. 4. Review your prices regularly. You might be doing yourself a great disservice if in a bid to come across as affordable you under-price yourself. It is important to review your prices as often as possible. Especially when you’re in an industry like social media where your responsibilities are flexible and subject to change. 5. Be accountable. In the absence of a business partner or a co-founder, you need to learn how to hold yourself accountable. This can be as easy as setting small, medium and long-term goals and working toward them. These goals are important to give you a sense of direction and to keep you in check. 6. Toot your horn. One of the few things I still struggle with is putting myself out there as I’d like for my business to speak for itself. But the game has changed and the internet is over saturated. The only way for you to be noticed or to come across as a thought-leader or an expert in your field is if you put yourself out there. There are no two ways about it. Do you want to be the go-to person for a particular service? Put yourself out there and let people know. 7. Have confidence in yourself. When you are running a business, you’re gonna need all the confidence you can muster for the tough days ahead. You will face people who don’t believe in your dreams and your plans may even fail. It is important to keep believing in yourself even when others don’t. 8. Find time to improve your skills. Work/Life can be overwhelming sometimes and before you know it, three months have gone by without you learning anything new. In this ever-changing world, there’s a need to constantly improve your skills. Thankfully we have the internet at our disposal but finding the time can be a challenge. To fix this, make a schedule maybe during the public holidays and learn something that would directly improve your daily activities. 9. Customer service is key. Just because you’re not selling a product to a consumer doesn’t mean customer service is any less important. You’re selling services. Treat your clients with courtesy. Referrals are still king. If you’d like to share your story with She Leads Africa, let us know more about you and your story here.
5 ways to Enjoy Your Wack Contract Job
[bctt tweet=”Quit thinking the reason you’re not doing well right now is that you don’t get so much pay” username=”SheLeadsAfrica”] The most common jobs in Nigeria right now are ones gotten from a third-party company that is signed to provide employees for various employers. While I worked at one, I found that the reason employer companies choose the option of contract staffs is to reduce its expenses and improve profitability. A full-time employee may get a 50% raise from your salary, including HMO(Health) benefits. This is even more annoying for contract staffs because they do more of the work but have fewer benefits, up until the length of days to go on leave. However, there’s always a way to have the life you want regardless of the situation presented to you. [bctt tweet=”The vision you have for yourself should drive your passion for what you do now” username=”SheLeadsAfrica”] Know who you are This is nothing about your desires or visions – at least not for the purpose of this article. What makes you tick? Deep down your heart, what’s the core of your strength? The real test to enjoying your job, and your life, is to know who you are. Although the search of identity may be an ongoing process, there’s a core of you that reveals your truth in whatever situation you find yourself. Everything you believe yourself to be should not be dependent on anything else but you. Once you can identify who you are, it would facilitate the emergence of what you’d like to experience. [bctt tweet=”The true value of your job is not dependent on your position, but your personality.” username=”SheLeadsAfrica”] Change your cognitive experience The natural cognitive of man is attracted to negative situations that appeal to his senses. So for example, you get to find out the extra benefits due to full-time staffs in your company and it freaks you out (it should), it is only normal that you begin to take it out on your daily routine, colleagues and even your line managers. Two years after my experience as a contract staff in a financial institution, I was appraised and suggested to be converted into a full-time staff. I was excited when my line manager hinted me on this new development and was waiting for the big announcement. To my greatest disappointment, when my appraisal form got to the office in charge, my group head was summoned and asked, “Who would you like to be retrenched in order to approve Adesewa’s conversion?” Confused, she responded, “nobody”. “Well, because the company cannot afford the cost for another full-time employee,” they disclosed. It was a great consolation to have known that the reason for the default was a lack of the company’s capacity, not mine. If this happened to you, I know you would freak out, and probably drop your resignation notice to go somewhere you’ll be ‘celebrated, not tolerated’. Just calm down! LOL! The quality of the delivery of your duties should be influenced by positivity. Contract jobs hardly come with motivations. Thus, you must always find a way around it. While you have a plan to quit, be deliberately positive about your daily dealings. The more positivity you exude, the greater the attraction for more. If it doesn’t happen for you in this job, it would somewhere else. Create value for your personality One of the many reasons people want to be in the full-staff cadre is so that the company can place value on them. The true value of your job is not dependent on your position, but your personality. Quit thinking the reason you’re not doing well right now is that you don’t get so much pay. Your pay may not equal your plan, but it does not necessarily influence the core of you, except you want it to. So, during a knowledge sharing session at your company or a proposal pitch, you have the platform to ‘show yourself’. Yes! Flaunt the stuff you’re made of! This is not PRIDE; it is PURPOSE-ON-DELIVERY. Always look for opportunities to reveal who you are asides from being the “front desk officer” or “cashier”. Profer solutions to problems. That’s what employers want to see. Even though it may likely not buy your conversion as a staff, it would increase your value as a person. You are first a person before being someone’s staff. Work at it! Work experience is in phases, enjoy this one A young entrepreneur who also works as an employee reached out to me one day. She shared all her frustrations as to how she was not getting fulfilments with her job. She mentioned how she knew this was not what she signed up for her life and all. The truth is, at every point in life, we get bored. This is not just a contract thing, stop blaming it on the job. Because guess what, even if you were full time, you would still get bored. All days are not the same, and all work experiences are in phases. You have to learn the art of enjoying the phases by creating systems that work for you. At the financial job experience I told you about, every week became annoying because there had to be something new to do – things that were way out of the initial job description(JD). Whichever way I felt did not matter to the company, the job had to be done anyway. And the only way to be happy with your job is to be happy with you, knowing that this is only a phase. You would get involved in better things and greater opportunities, so if you want to make your life count, you have to do it right. Always work with the end in view You know, many times, we are motivated in the present by having a vision of what’s to come. Doing your job with the end in mind is one sure way to enjoy what you’re doing currently. So, pending the time you
It’s okay, being an entrepreneur isn’t for everyone
You know how some women profess to never having felt that maternal urge or instinct and they just know being a mum isn’t for them? Well, not everyone should be an entrepreneur either. I believe more women need to hear this. In this day and age, it almost seems like if you’re not thinking of running your own business, with the whole uncertainty in the job market bit, then something is off with you. Maybe not. At the end of the day, if you see yourself as more of a technocrat for instance, that’s fine. There are certainly other ways to make your mark in the world. [bctt tweet=”So don’t stress, and don’t get pressured if building your own business is just not your cup of tea.” username=”MercedesAlfa”] Let’s be real. Being an entrepreneur is a lot. It starts with having a clearly-defined vision of what you are looking to accomplish, and then requires working tirelessly to achieve that. It really is okay if you are one to help others build their dreams. Some people are leaders, some are builders, some are followers, some are supporters. Being able to identify who you are at all the different stages of your life is gold. Besides all that, there actually is a difference between being self-employed and being an entrepreneur. Think about it. Some people prefer to work for themselves because of benefits such as flexibility and independence. However, it does not necessarily mean you are cut out for taking on huge risks that come with starting a business. Now that we’ve got that out of the way, let’s focus on what you can do to continue Slaying: Discover Your Strengths If you’re not entirely sure what you’re good at, you could ask people who work closely with you to point out some of your strengths. What are those things that come naturally to you? It could be things like negotiating or communicating, or maybe you’re good with numbers or mediating issues. As soon as you discover your strengths, you should capitalize on them to help you stand out and propel yourself in your career. Acquire the hottest skills on the job market Keep on top of your game by updating your work skills. Make sure you’re marketable and an asset in whatever capacity you operate in. Make wise investments Your youthful years are a great time to make investments that you can fall back on in the future. We know Instagram and Snapchat are brimming with what might seem like the good life, but remember it’s more important to spend your income wisely rather than try to keep up with the Kardashians. Look out for a great savings plan which offers good returns. You could begin looking at taking out a mortgage or investing in real estate, stocks, bonds and so on. Be sure to do your research and speak to a financial adviser before you get your feet wet. Moral of this story? You’re a hot commodity all on your own, so don’t let people tell you any different. It’s so okay, being an entrepreneur isn’t for everyone. Do you have an interesting career story to share with us? Let us know more here.
The elephant in the room: Year-end bonus
[bctt tweet=”You need to have a financial safety net for when companies can’t pay bonus cheques” username=”SheLeadsAfrica”] Cash Roulette Many of us dream of the plans we will carry out with our year end bonus. We have already lined up a string of events which we are going to splurge on, and have soon- to-be-bought outfits picked out mentally. In addition to that we have, the vacation plans, the children’s school apparel and school stationary for the next year. We basically plan out an entire budget (read: splurge) from our upcoming bonus. The elusive 13th cheque It may happen that one is so accustomed to receiving their bonus cheque every year-end that it ends up being a customary thing; where no consultation is had and there is an expectation that this will definitely come to pass. However, most companies give 13th cheques based on the performance of the company in a particular financial year. Other companies offer a bonus on the premise of whether an individual has performed their duties exceptionally or not. As such, it is always important to never just assume that you will receive a bonus. It is important to inquire with human resources, the company accounts division or your immediate supervisor. This will assist in managing expectations from friends, family and yourself about what you can or cannot spend on. [bctt tweet=”Most companies give a 13th cheque based on the performance of the company in the financial year” via=”no”] Money makes the world go round… Or does it? There are a myriad of things that money can help us achieve. But, is it the be all and end all of our lives? Oftentimes companies are not able to pay out bonus cheques in a particular year. In this case, it is advisable to have a financial safety net which will assist with the year end and early year costs which come after festive shenanigans. In order to ensure that you are not caught between a rock and a hard place; the first step to building a healthy financial lifestyle would be to save a portion of your monthly income. A little bit every week or month (depending on your remuneration structure) will definitely will go a long way. The myth about ‘goals’ In the 21st century everything either qualifies as or is a goal. An aesthetic, something to live up to. Everyone is in a perpetual and often self-inflicted rat race. We want to be better, own more, drive the best and live in an affluent neighborhood. Even if all of this at an often high cost to the self. Alleviate this pressure by being certain of your finances before making commitments. No is a complete sentence We need to learn the art of saying no to situations which do not grow us or expand our territory. The aim is to lead a life that will not be drastically altered whether you receive your bonus or not. It is possible for one to lead the ideal life without having to break the bank to get there. It requires self-discipline and a huge dose of honesty. [bctt tweet=”You should lead a life that will not be drastically altered whether you receive your bonus or not” via=”no”] Bonus or no bonus? The aim at all times should be to ultimately lead a life of financial freedom. If this means having a side business/job on the side, then so be it. Truth is that for most of us, one source of income is not enough. Some are fortunate to have partners who balance things out in the home because of a dual income. However, it is possible to live your best life and stay out of debt at the same time. Financial freedom should be the new cool, the ultimate aesthetic. Do you have any financial tips on budgeting for the festive season? If you’d like to share your story with She Leads Africa, let us know more about you and your story here.
3 key questions to ask when looking for the right banking partner in Africa
Finding the right banking partner in Africa Home to some of the fastest growing economies in the world, Africa has an abundance of attractive investment opportunities. Emerging market and developing economies are anticipated to grow 4.1% – far faster than advanced economies, according to the recently released Global Economics Prospect report, who also cite Ethiopia, Tanzania, Côte d’Ivoire and Senegal as some of the fastest growing economies on the continent, and in the world. Tapping into the opportunities that come from that growth – whether as an individual or entrepreneur – will likely leave you in search of a dedicated financial services provider. But how do you go about finding a stable partner? We suggest asking these 3 key questions: What’s their strength & expertise? You need to assess whether they can they provide the required products adapted to Africa’s need, and if they have the financing to support your development if you’re coming to them as an individual or entrepreneur. What asset class do they work with and what segment do they service? Do they offer equity, mezzanine, or debt finance? The answer to these will help you decide if it’s the right fit for your business. It’s imperative that you feel confident in the stability and sophistication of their systems to manage any requirements your business might have. Assess the strength of their balance sheet – the stronger it is, the more likely they’re able to take on your project. Where are they located? Glocalization is key. You want a partner who has a global outlook, but with local expertise. Assess their footprint in Africa – and find out how expansive their presence on the ground is in the country you’re interested in. This extends to regional presence too if you’re looking to engage in cross-border transactions. Do they have an extensive network of bank branches and ATMs for you to access across the country or countries you plan to operate in? That physical presence means they’re likely to have a better understanding of the local landscape – with 54 countries in Africa, each environment is unique, and you want a partner who is able to help you navigate through it. How accessible are they? Embracing the digital revolution is no longer an option for financial services providers, with online banking playing a critical role in delivering innovative products within the globalised business environment. While not all banks have adopted a digital first mindset, most offer basic electronic facilities that allow you to access your accounts online, whether personal or business. But what about more advanced business needs – are the systems efficient enough to bank manage complex transactions like managing liquidity across a range of local and foreign currency bank accounts?
Financial affairs in freelancing
[bctt tweet=”Like any business, freelancing has its peak seasons and its low seasons. Know them” username=”SheLeadsAfrica”] So, you delved into freelancing. You jumped head first (or first dipped your toes, whichever works for you) into being your own boss and now nothing can stop you from working in your pyjamas. First of all, big hearty congratulations. Not many make it past opening a freelancing account somewhere, let alone enlist clients. And now that we have gotten the pleasantries out of the way, let us get into the nitty gritty. The big girl stuff. Mogul business. It is essential that you realise that like any business out there, freelancing has its peak seasons and its really, and I mean, really low seasons. This being said, it is essential that finances line up throughout these seasons. Let’s get to it. Know your market This is the basis of any business, and it applies even in online businesses. Knowing when the seasons’ peak and when they fall is essential in managing your money. In academic writing, for instance, seasons pick at around March-April, August-September and in December, which is the end-of-semester months. If one is freelancing designs for say, at a corporate company, it is essential that you understand their fiscal year and how they pay or contract employees then. Know your worth Some people may have you believe that since you are freelancing your services, they have to pay less that is required. Knowing the pricing on your product and service is crucial in you making profits, in the long run. So, do not undervalue or overvalue yourself. [bctt tweet=”Know your worth as a freelancer, do not undervalue or overvalue yourself” username=”SheLeadsAfrica”] Factor in your expenditure Granted, there is not much revenue that you put in when freelancing unless you are renting office space. Your internet plan, however, will straight out flatten your morale if you are not careful. Choose an internet plan that is affordable for you, and that you know you can easily manage even when literally no clients are coming through because it will happen. Ride the wave High seasons in freelancing are really high, and what goes up will hit rock bottom with the same momentum. When that tide comes in, ride it like your life depends on it. Work through the day and night, stock up on coffee or energy drinks, never see outdoors, whatever it takes, stock up on that money (just remember to factor in self-care, of course). Stock up on some emergency cash Yeah, things happen. Your regular client finishes school, your contract ends, life goes on. Set aside some money for an emergency just in case your bank account is depleted. This actually goes for all businesses. It is standard. Follow the 50/30/20 rule on cash Personal financing is basically what will take you through freelancing. Know what you are spending your money on, track your receipts, cut down on the ‘for show’ products, and follow the 50/30/20 rule. 50% of your income is used on basic expenditure (like rent, food), 30% settle your debts and maybe a few luxury products, and invest with the 20% that remains. Or, follow this SLA guide prepared to cushion you from spending everything. Network, network, network Even in the low seasons, remind your clients that you are available, and ask them to refer you to other clients. Networking and good service are crucial in this business. If you are working in your pyjamas and at the convenience of your home all day, something has to give. [bctt tweet=”Even in the low seasons, remind your clients that you are available” username=”SheLeadsAfrica”] That said, like in any business, consistency and good product/service will bring you the money. Personal financing will ensure that the money sticks with you. Happy freelancing #MotherlandMoguls!!
Take charge of your finances with this budget template
[bctt tweet=”Budgeting is not difficult, but sticking to the budget is where discipline comes in” username=”SheLeadsAfrica”] Most young women in their 20s and early 30s dream about quitting their jobs and starting their dream businesses. But if you ask them how they manage their salary, you will be met with “uuumms” and “eeers”. How will you manage your business income, expenses and plans of you can’t manage your salary? Welcome to feminancial management! As women, we need to stop being controlled by our finances and take charge of it! Let’s get started with 5 easy tips to begin taking charge of our money. 1. Budget How many sisters budget their finances? Let’s talk about Achieng. Achieng is 26 years old. She works in a bank and her career is just starting to take off. Achieng lives from hand to mouth waiting for her paycheck at the end of each month. She spends on hair (with the natural hair trending, products are not cheap hehe!), clothes, social hangouts and such like expenses. Come one week before pay day, she is already broke, with just enough cash to last her till exactly payday. Does Achieng budget her salary? No. Does she track her expenditure? No. Has she allocated some money for investments or savings? No. Her reason will be she just earns enough for her upkeep. Once she’s promoted or gets a better paying job, she will start saving. Chances are she will not. Actually, no, she won’t save. What am I saying here in short? Budget your income. Distinguish between your “wants” and “needs”. You want that designer bag, you don’t need it! Budget “Savings” as your first expense in your budget. 2. Discipline Once you budget your finances, you need the discipline to stick to the budget. Meet our other sister, Fatma. Fatma is a 24 year old entrepreneur. She does online jobs and her income is intermittent. Once she gets paid, what does she do? Remember that nice dress she saw in that shop? She buys it and spends and spends and spends till she is broke and waits for the next gig to come along. The truth is, budgeting is not difficult, but sticking to the budget is where the rubber meets the road. That’s where discipline comes in. Track and monitor your expenses on a daily or weekly basis to help you stick to the budget. Separate your finances as per your budget e.g. if it’s bills, pay them immediately your salary comes in, if it’s savings, put up a standing order to a separate Savings account Remind yourself of the target, create a board even with pictures of your goal to keep you focused. 3. Goals Have I told you about Maame? Maame is a 30 year old stay-at-home mum. She recently had her second baby and can’t wait to shed the baby weight. What’s her goal? To shed off 20 Kilograms. What is she doing about it? Nothing! What gyms or exercising videos has she researched on to start her off? None. Doesn’t that look like most of us making New Year resolutions? It’s definitely me. We make plans in our head about our financial goals but we don’t put in the work needed to reach those goals. After a few months, we’ve forgotten all about it or have a myriad of excuses on why we couldn’t attain our goals. What can we do about that? Write down your goals. Break it down into sub-goals with time frames. Lastly be realistic about your goals otherwise you will get discouraged along the way and quit. [bctt tweet=”Keeping up with the Kardashians is great but keep up with news and current trends too” username=”SheLeadsAfrica”] Knowledge Meet Bola, a 32 year old doctor. She is a high-flying woman with the world at her feet earning a six figure salary and living the life. What investments has she made since she started working 8 years ago? You guessed right! None! Why? She doesn’t know where to start in investments. Is it real estate or stocks? She has no clue which direction to take. Most young women know a lot about their field in careers but no zilch about investments. But here is a chance to start somewhere Find a field of investments that interests you, and research on it. Make Google your friend. Mentors –talk to someone older, not even necessarily in your field who can guide you and perhaps you can learn from their success and failures. Keep up to date with current trends. Keeping up with the Kardashians is great but keeping up with news and current trends and innovations will help you a huge deal. Time Say hello to Esihle. Esihle is a pretty 23 year old in her first job after university. Esihle now has the “financial independence” she has been waiting for and no longer has to ask her parents for money. So where does she spend her free time? Social media, just stalking her friend’s timelines seeing what they have been up to, posting photos on Instagram with hundreds of filters and catching up with her friends over drinks after a hectic week of work or just catching up with the latest series or movies. According to research, the average millennial spends 9 hours a day on social platforms. How many years did she spend in the university learning about let’s say Journalism? About four years. How many hours does she spend learning about something financial related? Well, not enough. If she took four years to study in University and can afford to spend 9 hours on social platforms, how much more informed can she be if she spent one hour learning about investment opportunities like stocks for example each day? The point is we become empowered when we are more knowledgeable. We become knowledgeable when read and learn. We can only read and learn when we create time to do it! *Drops mic! What are you waiting for? Get empowered! Start by
Making #MotherlandMoguls money savvy: The big bad B-word of personal finance
[bctt tweet=”Smart budgeting is how you get rid of the guilty feelings that come from spending” username=”SheLeadsAfrica”] “Budgeting is fun!” Said no one ever…oh wait; that’s actually what renowned Personal Financial Management Guru Bob Lotich says. The first time I read that I laughed myself silly and with good reason. However, the more I read his thoughts the more I understood what he was talking about. You know that feeling you get when you spend money that you don’t have, to do something that is probably not that important, like buying yourself a new pair of stilettos. That feeling that lets you know that in a couple of days or weeks you’re going to regret spending your money like that? It will probably come to you when you don’t have cash for fuel a couple of days to payday. Or when you have to borrow money for lunch or fare, or both to take you through the last stretch of the month. That’s when you remember the money you spent on those stilettos and how absolutely unnecessary it was. Guilt, that’s what that feeling is called and budgeting is how you get rid of that feeling. It’s liberating to know that you are buying a new pair of shoes or a new dress or going out for a drink when you know that you set aside some money specifically for that purpose. Either you do, or you don’t Generally, when it comes to budgeting people fall into three broad categories. You either don’t do it at all and you spend as need or want arises. Or, you budget only for the fixed major expenses like mortgage, rent, school fees etc. Or you’ve got budgeting OCD as far as your money is concerned and you have to know exactly how every shilling you have is going to be spent. [bctt tweet=”Generally, when it comes to budgeting people fall into three broad categories.” username=”SheLeadsAfrica”] I fall in the second category as most people, where any other expense that is not considered major falls under the ‘’miscellaneous’’ box. I have come to learn that my miscellaneous box is where my money disappears to. It’s the hole in my pockets so to speak, every small expenditure planned or unplanned falls here. Most financial management experts will tell you the first rule of budgeting is to know where your money is going. Now, this is a tedious process and can be far from fun. It’s going to need some discipline, but you can do it. Know where your money is going If you have never sat down to look at what your spending looks like on paper you will be shocked at what you discover. Start by using one or two months —possibly even three for good measure, take note of every shilling spent. [bctt tweet=”The first rule of budgeting is to know where your money is going” username=”SheLeadsAfrica”] Not only the big stuff but the little stuff as well, every time you buy airtime, every time you buy a bottle of soda for yourself or someone else or any time you have to get something for your children, whether you knew about it in advance or didn’t. This is the cash that slips through the cracks and easily goes without notice. At weekly intervals sit down to put it all together and see what your spending looks like. This is the first step of budgeting. Once you have this on paper, cluster the expenditure into the major categories: household expenditure, bills, entertainment etc. This process is important because once you have this picture in your mind, you will know where you’re overspending or you’re likely to overspend. Then, you’ll start making decisions on what needs to be cut off so that what goes out is equal to or less than what comes in. Knowing how much you spend on an item on a weekly or monthly basis will also help you know when you can take advantage of some great offers when you shop in bulk. Are you ready to give this a go? Have a look at these exciting downloadable budget spreadsheets to get you started. Thank me later.
Pensions, Savings, Trusts, Insurance. What is This All About?
With so many investment products on the market, we understand that it can become quite overwhelming and confusing when trying to make the best investment decision for your financial goals. But, fret no more! We’ve produced a pensions, savings, trust, insurance guide that will help you make the In-Telligent Choice and be on your way to financial freedom. Pension A pension scheme is a type of savings plan that helps you save money for later life. It has favourable tax treatment compared to other forms of savings, which is an added advantage. How it Works? You save a little of your income regularly during your working life so you can have an income when you retire or decide to work less (at retireable age). There are several types of pension schemes. Some may be run by your employer, others you can set up by yourself. Saving in to one scheme doesn’t mean you can’t save into another or use other tax-efficient savings plans. When the time comes for you to start enjoying your pension, there will be several options available to you. These may include being able to take a tax-free cash sum and the added security of being able to receive a regular income, now that you are not working full time. Savings Saving is income designed not to be immediately spent. Methods of saving include putting money aside in, for example, a deposit account, a pension account, an investment fund, or as cash. Saving more than just an account, it is also a deliberate act to reduce expenditures in your life. In terms of personal finance, saving generally specifies low-risk preservation of money, as in a deposit account, versus investment, wherein risk is higher; in economics more broadly, it refers to any income not used for immediate consumption. To be considered financially secure, an individual or household should save at least six months’ worth of expenses. For example, a household that has N20,000 per month of expenses should have at least N120,000 in savings (N20,000 multiplied by 6 months). To reach this amount, it is recommended that 10- 20% of net income should be saved until the appropriate amount of savings is reached. Trusts A trust fund is a fund comprised of a variety of assets intended to provide benefits to an individual or organization. A grantor establishes a trust fund to provide financial security to an individual, most often a child or grandchild, or organizations, such as a charity or other nonprofit organization. A trust fund contains cash, stocks, bonds, property or other types of financial products. The recipient of a trust fund must typically wait until a certain age, or until a specified event occurs, to receive a yearly income from the fund. Prior to this, a single trustee, or a group of trustees, manages the fund in a manner appropriate to the trust fund’s specifications. This usually includes some allowance for living expenses and perhaps educational expenses, such as private school or university. Insurance Insurance is a means of protection from financial loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. An entity which provides insurance is known as an insurer, insurance company, or insurance carrier. A person or entity who buys insurance is known as an insured or policyholder. The insurance transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer’s promise to compensate the insured in the event of a covered loss. The loss may or may not be financial, but it must be reducible to financial terms, and must involve something in which the insured has an insurable interest established by ownership, possession, or preexisting relationship. The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insured will be financially compensated. The amount of money charged by the insurer to the insured for the coverage set forth in the insurance policy is called the premium. If the insured experiences a loss which is potentially covered by the insurance policy, the insured submits a claim to the insurer for processing by a claims adjuster. For more information about investment products and services, contact United Capital Plc. Web: www.unitedcapitalplcgroup.com Phone: +244-1-280-7596 Email: customerservice@unitedcapitalplcgroup.com Twitter: @UnitedCap Facebook: Facebook.com/UnitedCapitalPlcGroup United Capital Plc is a leading Investment Banking Group providing capital financing solutions to governments, companies and individuals across Africa. We are well positioned to play a strategic role in helping Individuals achieve their strategic objectives through our robust suite of financial and investment service offerings. Sponsored Post