Finances can be defined as the monetary resources and affairs of a state, organization or person. Effective financial management is crucial for individuals, organizations and states.
As believers, God desires that we manage our finances effectively.
As students, we are often met with financial constraints at different points in time as our sources of income vary and we do not always witness a steady flow of income. In moments like that, how we get by speaks volumes and the importance of saving for emergencies/rainy days does come in handy.
I have found these financial management strategies helpful over time and I know you would find them useful too.
DIFFERENTIATE BETWEEN NEEDS AND WANTS
Prioritize essential expenses over desires.
CREATE A SPENDING PLAN
Utilize the 50/20/20/10 budgeting method for effective allocation of income for your important needs and wants.
10% goes to God in the form of your tithes.
50% goes to your needs.
20% goes to your savings/investments of your choice 20% goes to your wants.
Let’s say, for instance, you earn 50 thousand naira, using our formula:
5000 goes into your tithe.
25000 is used to satisfy your needs.
10000 is put into various investments or savings accounts.
10000 can now be used to satisfy those wants.
This formula can help us as students learn how to save and budget any amount of money that we have.
INVEST FOR THE FUTURE
Explore investment options to grow wealth over time. In recent times, we have different financial apps that make these things easy for us, apps like Piggyvest, Rise and Bamboo, to mention a few of them.
ADDITIONAL TIPS
Patience is essential for successful investments. Don’t invest and put your whole mind into it immediately, instead allow your money to appreciate over time and you will see the positive results as the years go by. If you still doubt it, remember Warren Buffett, he wouldn’t have been where he is now if he wasn’t patient with his $1 investment.
Seek guidance from financial experts when necessary.
Involve God in financial planning.
My dear friends, finance is a really broad and important aspect of our lives, and I would love to encourage everyone reading this to make smart choices about their money; spend wisely on your needs first and always involve God.
I hope we will all make smart decisions and not allow our fears to cripple us from making the right decisions that will advance us forward in our lives.
Okoye Chioma