Today, we will continue with some more measures we can take to minimise our expenses. Again, let us keep in mind that as a general rule, regardless of what we may be making in income, getting the most value on our spendings (whether financing investments or covering expenses) should be of paramount importance to us. Furthermore, more financially vulnerable people should take particular attention to their spendings. These may include young people just starting out their careers (as they need to build the initial assets they need to catapult them into the next stage in their business or careers), middle-aged persons at about the peak of their careers (as they need to be fully involved in making investments towards eventual retirement), and those about-to and already-retired persons (as they need to consolidate on the wealth they have created and should be as wasteful as is minimally possible). Yes, this essentially means everyone!
Get the children to help with the chores! The middleclass may be helping by employing househelps from their extended family or villages. However, their first responsibility is to their immediate family. Hence, it helps to get the children fully involved in domestic chores. That may not only help in reducing some fixed expenses, no matter how ‘negligible’ they might seem, but even more importantly, you help the children in developing their personal discipline and make some income by way of allowance for them, which makes them mentally link honourable labour with financial reward. A longitudinal study over 24 years in the US revealed that one of the best predictors of a child’s success is whether they were made to begin helping with household chores at about the age of 3 to 4. Such children were less likely to use drugs and had better relationships, among many other significant benefits.
Always Negotiate! There was a time in my life when I hated to negotiate. I thought people were always fair and would do what was ‘right’. I was definitely wrong. We need to negotiate our way in life, from right with our families to our employers, employees, and business associates. When I realised my folly, I sponsored myself to attend a series of courses on negotiations within and outside of country! Now I negotiate anywhere, anyhow, with anyone and everyone, and I enjoy it. I don’t even agree that we should not negotiate with people selling corn, groundnut, etc., on the grounds that they are operating on a subsistence level and patronising them is helping them both in their business and in their lives. Rather, what I do is to negotiate and get the best and fairest deal possible with them. What I pay for goes to one financial account mentally. Then, I can support such microentrepreneurs by giving them any ‘substantial’ amount I can afford as support for their business. That goes entirely into another financial account in my mind. On one hand, I treat the two payments differently from an accounting perspective, and on the other, they treat the two amounts also differently. In addition, they appreciate the support they get from some random member of the public. When you want to buy something, negotiate and buy it. When you want to help, help.
Invest in assets that will save money for you: Last week, we tangentially talked about the need to minimise non-income-generating travels, given the high costs of fuel now in comparison to what we used to pay just a few months ago. Obviously, we are a very social people, and there is a limit to how we can reduce the cost of our social travels. Nonetheless, we can plan and coordinate our movement in such a way that we minimise the cost as much as is practically possible. Sadly, we are people who often refuse to change our ways even when the basis of why we were behaving in a particular way has significantly altered. We have to be real and easy on ourselves and each other to save ourselves from certain avoidable difficulties.
Beyond saving on the cost of movements, we can plan to save the cost of energy both in our households. For instance, we can work out the numbers and see whether or not it makes sense for us to go partially or completely off the grid. Can we invest in solar panels, batteries and inverters that will provide part or all of our domestic energy needs? If the numbers make sense and we can afford it, by all means, let’s go that way.
Please check the cash register printout! I have been to a restaurant in Lagos, a shopping mall in Kano and a restaurant in Abuja. In each case, an attempt was made to charge me for what I didn’t buy! In some cases, in more than one incident. None was an innocent error, and I could see the ‘shame’ of being caught on their faces. Check what you buy both in quantity and against the price. When I told a senior friend that I do this, he made a remark about me that I consider the best of my life.
Remove the vice in our lives: Some bad habits cost us a lot of money. For instance, smoking and substance abuse take a toll on our finances. Stopping them saves us money directly and indirectly, such as on medical attention that we may require as a result of the habits.
Next week, we will take up ways in which a budget will help us both achieve our long-term financial goals and manage our personal expenses.
