you are all wellcome, feel free to add more.

It's the second half of the year and it's that period when a lot of people review their yearly goals/resolution. Some of us may have decided to save more, invest more, have additional streams of income,etc. Whatever your money goals are, here are 10 bad money habits you need to avoid so as to achieve your financially goal faster.

1. Spending first, then saving what is left: I have over flogged this point but this is so important that I have to keep repeating it. A lot of people say, oh AKAglue I have been working for xx years but I have been unable to save/invest. The reason you are unable to save is because you are trying to save what is left after spending. the right way is to save first, then spend whatever you have left .

2. Not having a budget: A budget shows you how much to spend on each expense category. With a budget in place, you see how much money you are bringing in and where they are going to. If you do not have a monthly budget, you are most likely not going to be financially afloat. Budgeting is not a difficult task, see my post HERE on a practical family budget. http://akaglue.com/a-practical-family-budget/

3. Buy now, pay later: A lot of people live pay check to pay check. Even before their monthly salary comes in, they have already expended all of it. Except you have a hang over your finances, I do not encourage buying on credit. Over the course of the year, you realise that you work just to service your debt. Do not buy items that you are banking on your next salary for it's payment.

4. Buying on impulse: A lot of ladies are guilty of this, me inclusive. Someone comes into our office with this shoe that we love, meanwhile we do not need another black shoe because you have 5 other pairs of black shoe. We coo and aww over the shoe, and gbam we buy it. Most times we even buy them on credit. Before you buy an item, think through it. Learn to differentiate your want from your need. You may want the shoe but you do not need it. Impulse buying is emotional buying. Avoid the temptations and be a master over your emotions.

5. Living above what you earn: Eating out on a daily basis/dining out on a weekly basis, expensive spa treatment, luxury holidays, expensive jewellery etc. While it's ok to indulge in them if you can afford it, but for those that cannot, try and reduce all these personal vices so as to live within your means. Don't try to impress anybody and be real to yourself.

6. Deeping into your emergency fund: Personal financial planners always suggest that you have funds that can see you through a period of 3-6 months. I however advice 6 months. Yes we should not anticipate rainy days but these things do happen. I have heard so many stories of people that went to work only to find out that they cannot log into their system. If you have such funds, you should not be deeping into it no matter what unless it is for it's purpose.

7. Leaving all your money in your checking (current) account: A colleague of mine woke up one morning to see debit alerts to the tune of N1 million. While it is not security wise to leave all your funds in your current account, it is also not financially wise. You tend to over spend when you have all your money on one account, also your money is lying idle. I like having my money working for me. So move some to either a savings account, or a fixed deposit or invest it in the money market by buying treasury bills or in a mutual fund.

8. Not diversifying your investments : Always ensure you diversify your investments so as to spread the risk. A lot of people have lost tons of money by investing in only one class of investment. A lot of people have all their investments in the stock market. Also, even within the stock market, do not place all your funds in the same class of industry. e.g Having all your stock within the banking industry. Spread your investment across stocks, treasury bills, bonds, mutual funds etc.

9. Falling back frequently to quick loans: There are so many institutions that give out quick personal loans. They seem attractive because you do not need to present a collateral, but then their interest rates are usually high. While it maybe ok to fall back on them in times of great financial need, one should not fall back on them all the time.

10. Thinking that more cash will bring more financial freedom: More money does not necessarily mean more happiness . You may be earning more but be in debt because of poor money habits. However, while you strive to increase your earnings,be grateful for where you are, make the right financial decisions and increase your net worth no matter how little you earn. If you are faithful in little, much more will added unto you.

Want more personal finance advice or you want to read about my thrifty adventure / tips. visit www.akaglue.com

pacino26:
I think being thrifty pays even if you earn much. Fact is nothing in life is ever enough but if you've got financial discipline people won't even know when you earn little.
Plan within your means and aim high.

Very true. I can't agree less.

@Feran 14. Very true. The two works together.

A friend of mine asked me what my blog was all about. I tried explaining to her that it was a personal finance blog where I write about thrifty living, thrifty tips, money management, savings guide, 101 of investing , etc. She looked very unimpressed and then said, ' Why not just make more money instead of being thrifty. To be honest, her statement is quite correct. However, I have seen a lot of people including myself mismanage their increased earning.

A couple of years ago, my earnings increased but my net-worth remained the same over a period of 12 months. Why? My attitude to money did not change. I look back at those years and wish I had done things differently. I had to learn to manage my income properly. Now as a personal finance advisor, I guide people through managing their already earned income through proper financial planning, building a good savings culture and investing. I try to focus on living within your means, thereby accumulating wealth instead of liabilities. I preach living a fulfilled life without having to make your pocket cry.

Making more money and saving more money go hand in hand, it is a balancing act. You cannot build your net-worth by just making more money. Without proper savings and investment, you may mismanage your funds. For me, saving more money is also investing, and investments generate income. Therefore saving money is also making money. Now, whether through spending less than you earn or earning more than you spend. The ultimate goal is to grow our wealth.

So which do you practice or believe more in? Make more money or save more money?

bukatyne:


@OP; Lovely

I love that passage a whole lot and always use it as a base for my writeups to wives.

The virtuous woman is really my aspiration.

There is also the Proverbs 31 husband; stumbled on the book though did not read it though the summary said that's the husband that brings out the Proverbs 31 wife.

I do not think that chapter screams a 'perfect' wife; it describes a wife who is hardworking, diligent, dignified, beautifully dressed, wise, hosiptable and bold. Not the cowering women referred to neither is she a domestic machine nor a Yes sir woman.

Infact, she is more praised for her business acumen than her domestic skills.

I would say a non-faithful husband cannot be comfortable with a virtuous wife. He cannot appreciate her or know her value.

@Solomon: I think he was a joker towards the end

Thanks for the contribution.

Stillfire:


Akaglue, I often hear Nigerian women say 'his money is our money and my money is my money'. What do you think about that?

Well, I am not a marriage counselor and whatever works for the family. But then , as a woman, I encourage financial independency. Do not rely on your husband 100% , support him in what ever way. Even if you are not earning income, be prudent and financially wise and not be a waster.

The purpose of this thread is to encourage women to be financially independent.

- The aspect of the Proverbs 31 woman I wrote about is the industrious woman. The financially diligent woman.

- It is a wake up call to all woman to stand up and be financially independent. We keep hearing stories of how a man left a woman, or died or maybe lost his job, and the family is left in penury.

-We should learn from the mistakes of others and be industrious too.

Thank you.

feature11:


Thanks so much Akaglue. You can imagine, I now do so much maths before spending money. You have had positive influence in my life. Thanks so much. Please keep it up. I will visit your blog.

Thank you. I am glad to be of help. Feel free to contact me if you have further questions on any area on personal finance.

ladygogo:
i like your moniker and blog name. Keep it up.

Thank you.

Do read more of my blog posts on www.akaglue.com

Stillfire:
Solomon the wisest man on earth who penned down these 'lyrics' could not find this so called virtuous woman worthy enough to be faithful to. How much more some Nigerian!
Solomon had 700 wives and 300 concubines. Rotflmao! He was on a quest in finding that 'fairy tale' woman that never existed.
In Ecclesiastes 7:28 New Living Translation, Solomon says:

Though I have searched repeatedly, I have not found what I was looking for. Only one out of a thousand man is virtuous, but not one woman.

Lol. He found no woman virtuous, hahahaha!

This got me laughing. As in eh. Well, one can strive to be one. There are lots of Proverbs 31 woman.

amokeme:
Am a Proverbs 31 woman






The poster above me tho

welldone.

Antoinne:

What can i do for investment with 8 million ngn? Currently it's in fixed deposit, but the interests at the end of the month is rather small. Is there anything else you can advise?

Sorry for the late response. Kindly diversify your funds. (30% treasury bill, 30% mutual funds, 20% fixed deposit, 20% shares). Also, what is your purpose for savings? If I know the purpose, I can advice you further.

bukatyne:
@akaglue,

Keep up the good work

THank you dear. I am encouraged.

Kimoni:



Moca!!!!

Business is the most profitable but also very risky. One has to be really sure of the business



I am typing with one hand oo and carrying him with the other hand. He sleeps around midnight though.

And you? How are you and our angel? How is vigilante going? Hope you are getting small small sleep sha

It is well with us

Thank you KImoni. BUsiness is most profitable but very risky. SO I always advice that one should set aside some funds for save investment.

moca:

Exactly!
Though,left to me,i will put it into any biz that will yield good income than treasury bill.

How r u and family?
U no dey sleep?
How baby?

I agree with you that treasury bill yield more income. You see, one should set some money aside for investment. You do not put all your income into your business. Read my post, on start saving and unleash the power of compound interest.

I was talking to a friend and she said she does not believe in savings & investment. She argued that she will rather put her whole money into a business and get her returns. She went further to say that the future will take care of itself and she went all religious.

I told her all she needed to build her retirement/ kids college educational account was a few years of continuous savings. I shared a simple compound interest calculation with her and she was amazed. Compound interest is simply interest on interest. According to Wikipedia, Compound interest is interest added to the principal of a deposit or loan so that the added interest also earns interest from then on. This addition of interest to the principal is called compounding.This makes the principal to grow at a faster rate than a simple interest.

One thing about savings and investment is that it is never too early to start and it is never too late to start. Lets look at 2 scenario of 2 different investors that both started working at age 24.

Investor A starts saving and investing N200,000 yearly at the rate of 8% immediately he started working. He consistently saves N200,000 each year for the next 8 years and stops. His investment however keeps running at a compounding interest for the next 19 years.

Investor B is a spend thrift and does not see the need to start saving and investing. He realizes at the age of 32, that he has to start planning for his future. He saves N200,000 each year at the rate of 8% for the next 19 years.

They both decide to retire at the age 50 having worked for 27 years. Who do you think will have more money in their investment account at the end of the 27 years?

Years Age Investor A Investor B
1 24 200,000.00 216,000.00 0
2 25 200,000.00 449,280.00 0
3 26 200,000.00 701,222.40 0
4 27 200,000.00 973,320.19 0
5 28 200,000.00 1,267,185.81 0
6 29 200,000.00 1,584,560.67 0
7 30 200,000.00 1,927,325.53 0
8 31 200,000.00 2,297,511.57 0
9 32 0.00 2,481,312.49 200,000.00 216,000.00
10 33 0.00 2,679,817.49 200,000.00 449,280.00
11 34 0.00 2,894,202.89 200,000.00 701,222.40
12 35 0.00 3,125,739.12 200,000.00 973,320.19
13 36 0.00 3,375,798.25 200,000.00 1,267,185.81
14 37 0.00 3,645,862.11 200,000.00 1,584,560.67
15 38 0.00 3,937,531.08 200,000.00 1,927,325.53
16 39 0.00 4,252,533.57 200,000.00 2,297,511.57
17 40 0.00 4,592,736.25 200,000.00 2,697,312.49
18 41 0.00 4,960,155.16 200,000.00 3,129,097.49
19 42 0.00 5,356,967.57 200,000.00 3,595,425.29
20 43 0.00 5,785,524.97 200,000.00 4,099,059.32
21 44 0.00 6,248,366.97 200,000.00 4,642,984.06
22 45 0.00 6,748,236.33 200,000.00 5,230,422.79
23 46 0.00 7,288,095.23 200,000.00 5,864,856.61
24 47 0.00 7,871,142.85 200,000.00 6,550,045.14
25 48 0.00 8,500,834.28 200,000.00 7,290,048.75
26 49 0.00 9,180,901.02 200,000.00 8,089,252.65
27 50 0.00 9,915,373.11 200,000.00 8,952,392.86
Are you shocked at the result? Investor A’s investment account balance is higher than that of Investor’s B by N962,000.

This shows us the power of compound interest. The trick is to start saving and investing early. With just a little discipline, we can all achieve financial freedom.

damiso:
Well done akaglue I really love the concept of your blog. So refreshing and different. A welcome break from the usual 'aproko' and 'amebo' things . I like the part where you said ' call me stingy' Nigerians call anyone who sticks to a budget 'stingy or akagum' like your username.

Keep at it, the sky is your limit.

I follow a lady on Instagram, she is an American of Nigerian Origin and she started something similar. She has now actually quit her job as a teacher and travels all over the States and internationally giving talks on how people can manage their personal finances. She is called The Budgetnista. She is getting loads and loads of sponsorships from so many Financial organisations


Or Like Martin Lewis here in the UK ( the money saving expert). He is the go to person for all money saving tips and is regularly featured on most TV stations.

oh wao, I am motivated. Thank you for the encouragement. I have lots of idea for www.akaglue.com.

feature11:
Hello Akaglue, I love your blog and comments. You are a rare gem. I have so much to learn from you- and I think we have some things in common.

After reading your blog, I discovered that I have wasted over N1000 today on food. I am determined from now on to be frugal in terms of spending.

My daughter's 1st birthday is in two weeks time. I am thankful enough that it falls on a week day, but I don't want to spend so much on it- even though she will be celebrating it in school.
Also, I am going to the Lagos Island this weekend to buy baby things (I am pregnant). I intend to buy within my budget.

What suggestions do you have for me based on the aforementioned?

I hope my response is not too late. Thank you for loving my blog.

1. You should have a maximum amount (budget) that you intend to spend on your daughter's b.day.
2. Get a nice cake and party parks.
3. You can take pictures with your phone and go print yourself. (I did that myself for my daughters b,day)
4. Buy snacks and drinks should be included in the party parks.
5. You can buy this colourful cone hats, just to make the event look colorful.

It's a good thing you want to be more frugal in your spending. You are a financially virtuous woman.
I have new blog posts, do visit and comment. www.akaglue.com

Braaad:
@Akaglue, you are doing a very nice job here and I really appreciate it. I want to get some information about treasury bills. I was told if someone buys the bond with say 100000 naira, the bank will pay the buyer 10% of that amount upfront and the money will mature in 90 days. This they say is like getting 10,000 naira every 3 months for the 100000naira invested.

(Pardon my terminologies but I hope you understand the question)

yes it is very true. You get ur interest rate before maturity for treasury bills and it is not taxable.

Mind you, interest rate is per annum, so 10% is per annum. so every quarter your interest will be like 2,500. i.e assuming interest is 10%.

mentorandfriend:
But you're surely not a female. No vex!

Hahaha, I am very much a female. visit my blog and read about me.. I am not faceless. www.akaglue.com

samalive:
Akaglue, loved your blog and I really appreciate those candid advice u gave. Pls keep it up.
I want you to help with some lists of investment one can simply go into to earn more income. Bless you.

Thank you for visiting and loving my blog. I appreciate my dear readers. Please note that I am not into forex trading. I am an accountant and also a personal finance coach. So if u are looking for fast cash with huge returns, I can't help. I advice mostly people that are risk adverse, people like me that are ok seeing their money grow.

If you have a large sum for invest, you can diversify. put some in treasury bills, put some in mutual funds, put some in the stock market, have a personal pension savings. etc.

@swimcash, @momasenny thank you.

In the Christian circle, so much is said about the Proverbs 31 woman. She is a true model to be emulated by women, wives and mothers. One aspect of her that was highly praised by Solomon was her industrious and diligent nature.

The proverbs 31 woman adds value to her home, she is financially wise and responsible. She has the best intentions and helps her family to attain their financial goal. She sees a business opportunities and takes advantage of it so as to contribute positively to the welfare of the family.

The husband of a Proverbs 31 woman feels safe and trusts her, he has no need for spoil, meaning that he can trust her with the family finances, knowing that she will not cause him financial loss and pain.

The Proverbs 31 woman is also very creative and focused, meaning that she is not wasteful, she looks to the future and builds an estate. She finds opportunities to add income to the family, save for the family and invests for the family.

The Proverbs 31 woman is not afraid of the snow for all her household are clothed with scarlet, meaning that the financially virtuous woman is proactive and is a saver, she plans and budgets well for her family. She has emergency funds and ensures her family is secured with all necessary items at all times.

Are you a proverbs 31 woman?

No lazy woman is a proverbs 31 woman.

No waster is a proverbs 31 woman.

The Proverbs 31 woman is the perfect woman, strive to be like her, study and copy her.

As a woman, even if you are not earning any income through paid employment or business, you can save from the allowance your husband gives to you and invest it for the family.

Feel free to add more characteristics to the Proverbs 31 woman.

visit my personal finance/thrifty bolg. www.akaglue.com

mdbissalla:

i've gone through/studied the SampleFamilyBudget.xlsx you sent. i'm ok & much comfortable with it. it something that i can adhered to. tnz.
is there any thing you will like to share with me which may assist me in savings
regards

Once you get ur salary. Save a percentage of it. Put it in a different account. Make sure the account does not have an ATM.

Uchefrancis16:
Hello Akaglue!
Based on the tips you gave to mdbissalla, like how much will i get on placing my 100,000 on a fixed deposit account? That is whats the interest percentage pls?

You should be able to get 4-6%. Don't be discouraged at the small amount of interest. Remember it's an investment and it is best you compound the interest.

More recently, everyone is getting conscious of their health, body, hair. etc. You hear of different kinds of cleanse/detox such as; green detox, fruit detox, master cleanse, clean 9, vegan detox. People even detoxify their hair of all chemicals by having the big chop and going natural. However, I am happy to introduce to you a different kind of cleanse – The money cleanse.

So what is a money cleanse? It is simply getting back to your basics by eliminating all extra financial baggage and taking charge of your finances in the area of income, savings, investments, wealth creation and expense. The same way you detoxify your body/hair so as to get rid of toxins, curb craving, have a healthier skin / hair and a glowing complexion, that is the same way you can also have a money cleanse and also expect to have a healthier finance at the end of the cleanse.

Are you wondering if you need a money cleanse? If you exhibit more than 2 of the following signs, you sure need a money cleanse.

1. Your spending is out of control and you can’t resist buying on impulse.

2. You live from pay check to pay check and you get desperate/angry at your company’s payroll manager if there is any delay.

3. Your monthly total expenses is higher than your income and you are living in perpetual debt.

4. You struggle to keep up with your basic need/expenses such as house rent, school fees etc.

5. You have blocked some callers on your phone and avoid going to places where you will run into them because you owe them.

6. You always try to please your friends, colleagues and keep up with their trend so as to have a feeling of belonging. Simply put, your spending decisions are based on peer pressure.

7. You feel sad each time you look at your account balance and you do not have any savings/investment.

8. Your account officer is always calling you to fund your account, else they will bounce the cheque you gave to a third-party.

9. You are always buying same items or paying for same services at a higher amount than others. Simply put, you lack negotiation skills.

10. You support your excessive spending and false living with Matthew 6: 25-26. (For this reason I say to you, do not be worried about your life, as to what you will eat or what you will drink; nor for your body, as to what you will put on. Is not life more than food, and the body more than clothing? 26“Look at the birds of the air, that they do not sow, nor reap nor gather into barns, and yet your heavenly Father feeds them. Are you not worth much more than they?)

If you answered yes to more than two (2) of the above, my dear you need money cleansing. Kindly proceed http://akaglue.com/want-to-be-thrifty-spender-top-tips-on-becoming-a-cash-savvy-spender/#more-97 to start re-learning the basics.

I remain AKAglue, your personal finance coach. www.akaglue.com

mdbissalla:

i'm a public servant that earns #80,000. i've been working for 2yrs 7months now & i have no savings, no investiment, i leave on "pay check to pay check".
i'm married anyway (8months old).
how will i be able to start savings & probabily invest? knowing the cost of living
thanks

1. Never spend more than you earn.
2. Always save first before you start spending. A lot of people including you try to save what is left after spending which is WRONG. Spend what ever you have left.
3. Draw up a budget and resolve to stick to it. I have attached a sample family budget spread sheet. Play around with it and arrive at the right % for each expense head.
4. It is never too late, start saving now and ensure you are consistent (monthly) no matter what. Open a separate savings account for your savings, once u get to 100k, put it in a fixed deposit and unleash the power of compounding interest. http://akaglue.com/start-investing-now-and-unleash-the-power-of-compound-interest/
5. Live within ur means. For your income level, ur house rent should not be more than 150,000/ annum. (i.e ur house rent should not be more than ur 2 months salary) Anything above that will stress u.

@ chopet, I am an accountant and a personal finance coach.

j

Are you financially stressed? Are you spending more than you earn? Are you living pay check to pay check? Do you want to live a fulfilled balanced life?

Or do you want to get married but you are scared of the wedding costs? or are you stressed out and want a holiday but then you think you can not afford one?

Ask me any question on personal finance and I am here to answer all. I am AKAglue, your personal finance coach.

I am starting this tread because I see a lot of threads with the following topics;

- Can I get married and raise a family on a monthly income of N80,000.
- I want to get married but I don't have money for a wedding.
- Should I buy a car or buy a land?
- How do I start saving and Investing?

Start sending in your questions now and AKAglue will help you with answers and with practical tools to help you live a fulfilled balanced life.

www.akaglue.com

@ all. I hope u are able to download the excel sheet. see attached.

@nikkyshyne. the leaving the debit card at home is just for when going grocery shopping. I agree with you on the contingencies that can happen.
@onega, i have also been penny wise, pound foolish in this my thrifty journey. I even wrote a post on it. I won free tickets to an event and I spent so much on getting fuel. At the end, I could not even get into the venue because it was packed out. You can read my story here. http://akaglue.com/when-a-good-deal-is-not-such-a-good-deal-afterall/
However, I always advice that you save first before you start spending. most people save what is left after spending. this is a wrong approach.

I have a family budget spread sheet. you can see it here. https://docs.google.com/spreadsheets/d/13RnSwK4I-NIfGiRQNeMM_wYd3g7bQIrc8Jy0Z2FCPos/edit#gid=0