TMO Conversations 2.0 | Compiled Lecture on How to Manage your Finances
We had the second edition of TMO Conversations on Saturday, 28th October 2017 and it was a success. As announced earlier, the guest was Chunu Tejiri Jerry (Teajay), and we have put together a compilation of the discussion. If you weren’t there, you can catch up with this, and if you were, you can always come back to this for reference. We do hope you learn a thing or two from the conversation. Enjoy!
Teajay:
Before we roll, as a ritualist that I am, I MUST of necessity perform some rituals, just one basic one though…
I can hear some heart beats saying….did he just say rituals? Jeez, who is this #WarriBoy Tosin brought hia today ooooo .
Truth is most of us if not all are ritualists….as long as you do something as a routine….here, we pray.
Oya calm down…it is a simple but basic one….
The 2nd stanza of the national anthem:
O God of Creation
Direct our noble cause
Guide our leaders right
Help our Youth the TRUTH to Know
In love and honesty to grow
and living JUST & TRUE
Great lofty heights attain
to BUILD a nation
Where peace and justice shall reign
Funny how we have so recited this forgetting to realize it is a strong interdenominational interreligious prayer that if we embrace will reorient our approach to national issues (financial as well).
So we’re here to discuss something crucial to everyone. I believe everyone here is either broke, managing or not satisfied with what they have.
Since the topic was “Young & Broke”, I will assume we have young people here who are broke. Hehehehhehe
Please no forming, I have been broke and broken and just got out of it.
If you aren’t broke, let me see your hand. And please, don’t come here speaking in faith oooo.
This question goes to everyone: How much in total did you spend last year (2016). If you can’t tell me, welcome to the brokers society of Nigeria.
If anyone can tell me confidently: “Sir this is how much I spent in 2016. I spent N0000 on transportation, N000 on feeding, N000 on
recharge cards…etc”, then you are above my pay grade and officially NOT BROKE.
Before we discuss how to manage finance, we need to understand how many works and why it isn’t working or hasn’t worked for you.
See this, money responds to principles, not hope, desires or confession. If you don’t play by them, they will play you out of your game.
This question is simple a test of accountability. Not all money in your hand is for your “stomach”, neither is it for you. So, treating money as such will leave you very unaccountable.
I want you to pause now and write on a sheet or your digital notepad what you’ve spent today. When done, type DONE!
“A LOT” is the definition and synonym of UNACCOUNTABILITY
Have you ever asked yourself why organizations always issue invoice, ask for receipts and why banks have statement of account?
If those systems that declare billions keep records, shouldn’t that point that a man without records is actually not living a a measurable, amplifiable and replicable financial reality?
This is mine… Sat, 28/10/17
Income…
NIL
Expenses…
Transport — 9,500
Laundry — 2,000
Feeding — 3,000
Misc — 4,000 (Gave Blessing & Joseph N2k each)
Total — N18,500
Sometimes you may need to open your mind beyond what you know…it’s the best way to learn, trust me.
Financial/ business/ economic growth happens healthily on the foundation of accountability.
Being accountable is the most important reality of any singular entity, be it an
individual or organization. It is a criteria for financial growth. Remember, money follows principles.
Guys, don’t scrutinize my list. I do this everyday and guess what, it is being paid for. What I want you to pick here is that taking records is simple and necessary. It should become part of your daily routine. One way to keep at it is get partners that you’re accountable to.
If you can’t analyze your track, you can’t project or forecast your financial future.
This will lead us to something here.
But before that,
One thing taking daily records help you do, is realize where your money goes. Sometimes, you realize you spent your savings buying data or taking uber. You now know where is leaking and where to lock up.
Imagine, at the and of the month, you spent N5000 on calls and N3000 on data and it didn’t bring you at least N50,000 you are on a long walk into poverty.
If you take records, you will sooo laugh at yourself for being broke. You’d see why.
Please note, everything you spend is an investment. The question is what kind of investment?
So let me get into another reality. Follow me
I want you to do this:
Draw a big box and divide it into for…ensure it is as big as a page if possible. You will need to fill it. On the left side on top, write expenses, on the right side on top, write income. Now on the left side which is expenses, write budgeted on the outer side of the upper left box and unbudgeted on the outer side of the lower left box.
Now on the right side, which is income, write active on the outer side of the upper right box and passive on the outer side of the lower right box.
See illustration below
I kinda switched the left and right but anyways, do you get it now?
Active Income
List all you do to get money: Salary, profit from sales of products or services etc. Pocket money could be active income if you get it often.
Note: if all you depend is active income, you’re a liability.
Passive Income
List the things you’ve done with money that is now bringing you money without you working. If you don’t go to work you won’t be paid…that falls under active income. Here, if you don’t go to work, it still profits.
Examples are intellectual property, real estate, shares/ stock/ bonds, Automated Businesses, MLM etc. State which is working for you and how much. When done, total all your income.
Budget Expenses
List those things you spend on daily or monthly, from your personals (cream, perfume, paste, pads), communication, transformation, feeding etc. Note, if you are not budgeting, you are a liability to someone.
Unbudgeted Expenses
What you don’t plan for but end up spending. You know we are do this one well well ba? Your phone gets bad, emergency, health (which many of us don’t budget for), friends visit and you spend on refreshment or you go see a movie because everyone is seeing it and you have to buy popcorn when you don’t even have transport home. You buy a perfume or dress cos it caught your eyes…oya list.
When done, sum this as total of your expenses. Have we all done that? If yes, please BE SINCERE, which is higher, income or expense?
If expenses is higher than income, you need help.
Question: Where is the extra money you’re spending coming from?
Answer: Your future! You’re broke in future and will live paying unending bills and debts.
If income is higher than expenses, you’re financially secured but not free if active income is greater than passive income.
The goal here is to grow passive income so that passive income becomes higher than expenses.
Question: What passive income are you growing?
So we have established two reasons why we are broke amidst many others we can’t look at today.
1. We’re unaccountable
2. We have higher expenses than income
This awareness should help you:
1. Start being deliberate about taking records and being accountable. Get someone you can be sincere enough with to report to.
2. Research ways on how to grow passive income (talk for another day. I have something to share some other time but this isn’t my focus here. We could chat privately much later).
In wrapping this on managing your finance, these are few tips:
1. Set daily budget with limits and stick to it as much as possible.
2. Avoid as much as possible unbudgeted expenses. Learn to walk away or buy water instead of coke (delayed gratification).
3. Have a savings account that doesn’t have an ATM in a bank you don’t like. Any account with ATM is spendings not savings.
4. Maintain a moderate lifestyle. Don’t look at others, look at your goals. Don’t try to impress others, they really don’t care. Impress your future by being discipline.
5. Set financial goals and reward yourself when you achieve them. Plan for every cash you get.
6. Invest more in well researched profitable platforms.
7. Take daily accounts of your expenses, evaluate your expenses and use that to plan.
That will be all tonight. Thanks for your time. Any questions?
QUESTIONS
Question 1: Do we also state d duration. How the money comes, if it comes often or if its calculated or not
Answer: You can do this capture as a weekly or monthly or quarterly or annually thing
Question 2: But what if your income isn’t regular?
Answer: The right question should be: what can we do to regularize income
Question 3: What if the person relies solely on pocket money?
Answer: He should live a pocket lifestyle. Dreams don’t live in pockets. It is growing with an entitlement mentality. I believe everyone here is an adult, however, if you have desires and you can give in to them, you should be able to make “making money” a desire you strongly give into. No one is too young to make money.
What is the real difference between pocket money and alms? The day you see it as same, you will be more deliberate with your financial lifestyle.
Question 4: And most times before the next income comes in, you just have to touch your savings to avoid debts
Answer: If it is saving, DON’T TOUCH IT. You won’t die. If I can’t afford it, I don’t need it. The greatest challenge is discipline not needs.
Question 5: What if you can’t help your expenses being less than your income? Because all the things budgeted that you need to spend on are very important. What do you do, especially if you don’t want to borrow (since it’s the next option if there’s no other
income)
Answer: If your budget is higher than your income and you don’t have a plan to increase your income, check really the WHY and WHAT you are doing with sincere analysis of where you are. Sometimes, we plan in faith which is good without matching works based on where we are. Grow organically and work within your means.
Let me add here, it is poverty to think of just making money just to take care of your needs. If what drives you to make money isn’t bigger than you, you will always remain poor no matter how much is in your hand.
Check the richest people, their goal wasn’t just money. This is a topic for another day.
I will have to call it a night here. I have spoken at 3 events today and need to rest.
You can follow me on Facebook, Instagram and Twitter @UnusualTeajay
It will be my pleasure to help you grow. I have an affordable program you can join to help you with your finances. Just follow closely and stop giving excuses to remain broke.
Excuses are the tools of the incompetent used to build monuments of nothingness.
Challenge yourself to be and do better.
Impossible is Nothing!
We hope you’ve been able to learn something from this. You can let us know what you think in the comments below, and also subscribe to our blog to not miss a post.
Who’s excited about the next Conversation?!!!
