Surviving the Economic Winter.

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The economic climate is changing, creating opportunities for some who will see them and mayhem for those who care not to look at the changing climate.Although change brings opportunity, it can also bring strife, unemployment and pressure.In today’s economic climate, it will be very crucial for all of us to understand how money works, especially the control and flow of it.There are three things we need to do when it comes to our money in this season of both opportunity and trouble (depending on how you see it):

1. We must cut down certain expenses to create additional savings for investment.

2. We must increase our current incomes, even if it it means increasing them by small incremental amounts.

3. We must find a way to do both of the above.

CUTTING DOWN OUR EXPENSES:

We’ve got to understand that while we are waiting for that raise, or that big business breakthrough, we’ll have to learn to create savings from our current finances – even if it means small savings.

What would happen if you cut your grocery expense by only R100 and put it away? If R100 is too much, then how about R20? I use grocery as just an example but there are many areas in our lives where we can cut costs. All we have to do is look into our habits and readjust them. Instead of buying lunch everyday, why not pack lunch from home?

Why not monitor your trips? And try to save a minimum of R100 from that, and put it away? Maybe, just maybe, selling you current car and getting a cheaper one may do it. Maybe moving from your current apartment to a less expensive one will help you save money and create a financial buffer – WHATEVER IT TAKES.

INCREASING OUR CURRENT INCOMES

Increasing income is not as difficult as we have been conditioned to think it is. Like cutting down expenses by R100, why not find a way to create an additional R100, R1000, R10 000, or even R100 000 monthly? Depending on where you are in life, you’ve got to find a way to increase your income, even if it means selling certain products to supplement your current income.

By the way, we must stay way from any scheme that promises us quick gain or wealth. There is nothing like that. Building wealth takes time, and we have to be willing to start with little. When we are faithful with the small amounts, we can be faithful when the amounts are big.

If you have a house, or a flat, what would happen if you rented out your spare rooms for additional income? What would happen if you rented out your entire house (the rooms) for a big enough amount for you to rent a smaller apartment, while your tenants pay your rent and the bond of your house? What if you turned your house into a guest house?

What would happen if you found a way to use your knowledge and skills to get an additional income? Charging someone else or a company for your skills and they pay for it while you still earn a salary from your current job?

If you don’t have a job yet – what would happen if you started a gardening service in your neighborhood? You don’t need a large capital inflow to do that. What about cleaning people’s messy yards or houses? Wouldn’t that bring you extra income?

FINDING A WAY TO DO BOTH:

With time, doing both of the above will make you financially stable then financially independent. Imagine cutting down your expenses while simultaneously increasing your income? Imagine getting a raise then instead of moving to a bigger house, you moved to a smaller one? Or instead of buying a more expensive car you buy a less expensive one while you have an increased income? Of course there are many other examples. Let’s use our imaginations.

BONUS POINT

Save 10 percent of your income to invest in active investments that bring in cash flow monthly. This could be you buying something for the purpose of selling it at a profit.

Save an additional 10 % for passive investments, where you give an experienced person your money to invest for your (speak to your financial advisor). Or you invest in someone else’s business, and they pay you a dividend or interest for your investment.

Give away 10 percent of your money (to charity or to church), this will make you feel the importance of having more than enough to give. It creates a sense of purpose, and makes you want to always be in a position to help or give.

If you can’t do 10% then start with 1% , 1% , and 1%, then grow from there. It’s not really about the amount. It’s about the principle.

Finally, have fun while doing all the above.

Yours Sincerely,

Witness Mdaka
CEO, Quality Growth International


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