Personal finances

With the world becoming global, and the fast expansion of the internet, I found myself one evening watching a few Youtube clips on pretty much everything, ‘Bantu curls’, ‘sh*t Nigerian parents say’, ‘how to get a perfect smokey eye’, ‘forgetting an ex boyfriend’, ‘the new Rihanna music video’, ‘how to clean mussels’, name it everything can be found on the internet, with step by step details of exactly what you need to do.

After settling on watching Eddie Griffin’s stand up, I found myself compelled to get involved, share my experiences, thoughts, and possibly even pass on some knowledge.

The topic I will talk about today is on personal finance. I know...... not as interesting as some of the clips I saw on Youtube, but, hey.....I need to start somewhere. I find the issue on personal finance is assumed knowledge. However, not one class has any teacher actually gone through it....or at least not in my classes!! The shock when you leave your parents home and get your first bill! Though we are surrounded by water it sure as hell aint free!!

The first budget I made....well, more like my father made, was when I was going to uni, he budgeted down to the laundry soap! With life’s changes I had to flex my budget, after years of making budgets and always having a big pot of ‘miscellaneous’ I thought it was time to really sort out my finances....but alas, i kept on making budget upon budget with ‘miscellaneous’ and ‘overdraft funds’. And with over draft fund come credit cards, and with credit cards comes the vicious cycle of DEBT!!! It might start as £50 in one month, then you add another £50, and to justify the following months credit card usage, you tell yourself ‘but everyone lives on debt, it’s just how MODERN life is’.

So, last year finally, I learnt ‘how to make the perfect budget’ thanks to a really good friend. This budget gets you to really review, WHAT you are spending and HOW much you should be spending. 

  

So with this budget you split your income into 6 sections:

1.        NECESSITIES; this includes your rent, your bills, food and all other essentials for running your life.

2.        SAVINGS; this is your monthly savings. It’s never too earlier to begin saving for a car, a house etc.

3.        LONG TERM SAVING; this is savings that you will need in your old age, yes....I said it.....old age....even if you have just started work, it’s a good habit to get into. Put it into something you won’t have quick access to i.e. treasury bills, fixed interest bonds or a house (after your money grows J)

4.        CHARITY/CHURCH; the more you give the more you receive! This is healthy for your conscience. J

5.       HOLIDAY/EDUCATION fund; this fund is for holidays or extra education fund, other projects u might be looking into.

6.      ME!!; this is my favourite fund, this is money for u to spoil yourself, if you want to get your hair done, nails, shopping, dinner, just treat yourself or even a PS3 ;) !!

So for the split, 50% of your pay should go to you necessities, and the other 5 accounts get 10%. To start off with I suggest you make a month account and see how much you are currently using in each fund....it’s something good to look at going forward, if you earn £1000 and use £800 for your necessities that’s 80% of your wage is a lot, you are living to pay bills! You could look at cheaper accommodation, bundle up your service provider (t.v, phone, internet), share accommodation. The good thing about this is when you salary increases it doesn’t go to bills, it goes to the most important person in your life YOU!