Because life's complicated enough, let’s dive into smarter and flexible solutions to 5 of the most popular financial challenges families face.
“The good news is that regardless of your families’ social class or financial status - your family can easily resolve your family’s financial bind.”
You could earn millions but if you are financially disorganised money problems are inevitable and the same principle applies if you earn less than enough or just enough for a comfortable lifestyle.
The best way to be financially organised is to pay attention to your financial obligations through strategic plans that will have your money work for you and to achieve financial goals.
Here are some examples of what you’ll need to do to get your financial affairs in order:-
Not only is barely making it or having nothing a blow to one’s ego, but it takes a toll on your business goals, personal goals, family’s quality of living, and your finances.
The two main reasons why a family may not have enough to make ends meet are when the income earned is not enough and when too much debt is incurred. To address both or any of these reasons, your next step is to simplify and set up how to live within your means to reduce debt, save money, pay bills on time and increase your net worth.
For example, cut down or do away with some items on your discretionary fund/leisure budget, like stop / reduce takeout dining, cancel subscriptions or memberships for services you don’t or rarely use, switch to quality yet low-cost options
This helps to determine how much more is required to cover necessities and wants and if an extra income source is required. For example, a part-time job may be necessary and you maybe need to invest more in your side-hustle(s), your spouse might need to get back to the “corporate world”, just to name a few
Make a list of all the debts you have and arrange them in order of priority to make sure you are repaying the most urgent ones first, such as mobile loans and other short-term high-interest loans.
Also, consider debt consolidation, especially if you have multiple loans. Through debt consolidation, you could get lower rates and affordable monthly repayment amounts. Learn more about debt consolidation here.
For example: student loans, car loan payments, mortgage, and student loan debt are less urgent and paid off over a few months or years, while short-term debts from mobile money borrowing and overdraft are more urgent and paid off in days or weeks.
It’s not easy and it does take time but the relief of being debt-free or getting back to having manageable balances, is priceless
Once you are in the clear. Stay in the clear - which means avoid the temptation of racking up debts due to impulse buys and poor planning and/or due to no follow-through on your financial plans
We all agree that the “perfect job” doesn’t exist and for business owners, this means there’s no guarantee that business is always favourable.
Planning is one way to soften the blow of losing a job for you and your family, especially where household budgets depend on one income
Anyone’s job status, employed and self-employed, can change at any time. Take this problem-solving scenario example:
“If your spouse is the breadwinner and switched from self-employment to being employed; the plan in the event of job loss, could be to focus on self-employment opportunities as an income source, until your spouse gets a new job”
Your finances are private and it's not always easy to have the “money talk” with anyone, including your spouse.
Studies show that though financial problems are one of the top causes of divorce worldwide; they have little to do with how much money each earns but more to do with little-to-no communication between the couple.
A lack of effort to learn how to work together eventually costs more emotionally and financially. Make sure you always have intentional and meaningful conversations, to achieve specific results, such as:-
“Health is a priceless wealth. Invest while you can ~ Bryant McGill”
Healthcare is an expensive necessity and high medical costs may be due to different factors like medications, hospital stays & visits (and so on)
So, what next? Here is an expert tip
No matter how much your monthly income is, aim to set aside 5% - 10 % of your budget for health costs/health funds
Accurately budgeting for healthcare can be challenging given how unpredictable our bodies can be. Nevertheless, it is mandatory that you be adequately prepared.
In addition to the “5% - 10% tip,” here are some additional solutions:-
For example, “paying your insurance premiums should always take priority over any discretionary expenses. Treat as you would fixed expenses like your rent - you wouldn't go on a random trip to the Mara without paying your rent first, would you?"
Though healthcare costs of minor illnesses and injuries can be overwhelming, you can minimise these bills with a comprehensive healthcare plan that balance-and-protect your family financial plans
Usually, due to different circumstances, many people live paycheck to paycheck and even fewer can consistently save as much money as they would like for short-term and/or long-term goals.
For families, the lack of savings means your family is facing a bleak financial future.
Here’s how to get started on the financial freedom you want for you and your family.
Two simple ways to get started on your retirement saving:-
For uncomplicated guidelines on how to start, get a financial planner or a realtor involved, to help you get your savings plan in order and you can be a homeowner in no time.
*Home Equity Definition – The portion of your home that you have paid off, that is your stake in the* property and is your most valuable asset as a homeowner.
Money is an asset to have and as a topic, it is a continuous and evolving subject.
Always remember, whether you’re on top of things financially or still have a long way to go, financial issues are inevitable (and most importantly) shouldn’t be ignored. Make a plan to face your financial challenges and get to improve on your money management habits and you’re likely to get the job done, usually in a shorter time than you think.