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Why Personal Accountability is the Key to Financial Success
Money Management

Why Personal Accountability is the Key to Financial Success

Every so often, we have people in our lives we need to be accountable to or there are those who call us out requiring that we be accountable.

When this happens, it is because there are instances in our lives where we do not feel or act responsibly on our own and we may need some outside reinforcement to stay on track. 

Accountability in social interactions will generally mean taking ownership of one's actions toward others, which includes being truthful and ethical.

But did you know that when it comes to financial wellbeing, being accountable is as important?

What is Financial Accountability? 

Just like accountability in social interactions where it means being dependable, honouring commitments and keeping promises, financial accountability is taking responsibility for how you choose to use your money as well as the financial actions not taken. 

People who are financially accountable will not make excuses for their actions or blame others when things go wrong. 

Financial accountability means being open and transparent with one’s money and financial standing regardless of the balance sheet status. 

It can, for example, be achieved by allowing others to observe and evaluate our financial habits. These people can be mentors, financial advisers, or trusted family and friends who have your best interests at heart.

Being financially accountable is a big determinant of whether one can be a successful money manager or not. 

Impact of Accountability on Personal Finance

If you want to succeed, you need a system in place to hold you accountable. That is the long and short of it.

In order to make progress toward your goals, you must have an actual strategy in place before you begin. 

When someone or something is holding you to account, the possibility is that you will always perform better than you otherwise would without such a system in place.

There's nothing wrong with being motivated, but it's usually only enough to get us going. When it comes to long-term ambitions, most of us need more than our initial enthusiasm to keep us going. 

When your self-control is lacking, having someone or something hold you responsible for your word will provide you with the extra push you need to get things done. This accountability is what positively impacts your personal financial wellbeing.

How do you Become Financially Accountable?

Setting up a budget, making more money than you spend, maintaining a savings account, paying off your debt, and preparing for the future are some of the basic personal financial goals to aim for. 

Things, such as achieving financial goals, do not just happen. Successful plans are paired with a deliberate plan that is adhered to with fidelity. An accountability system is a key ingredient in the success of any financial goal. 

If you have set goals, milestones and have evaluated the resources needed to achieve these goals, then you need a way to keep auditing your progress, identifying pitfalls and course correcting. 

Here are some things to consider as you commence your journey to becoming financially accountable:

1. Budgeting

Considering the long-term effects of becoming financially accountable, budgeting becomes a critical aspect of the journey. A budget will help keep you out of debt which will make it easier for you to achieve a more prosperous future.

Budgeting helps you keep tabs on where your money is going. Using this method, you'll be more in control of your spending and more accountable. There are several apps that you can count on to help with crafting a budget and keeping track of your spending.

A budget is the backbone of your financial life. And having one alone is really not the goal, but setting a budget that is suitable for your income and goals, and actually following it to the letter. 

If you are motivated enough, this might be the only financial accountability tool you may require. 

2. Set Financial Goals and Monitor Your Progress

You may already have some goals in mind that you would want to achieve. It helps to have those goals well written out, divided into long-, medium- and short-term goals and matching them with the resources needed to achieve them. 

After setting your financial goals, you have to develop a system to track your progress. Are you working towards these goals alone or with your spouse? Are you part of a challenge with colleagues, friends or family? Working towards a collective goal can be a good accountability tool. 

Often, you may not be working towards a goal as a group which means you have to create intervals to evaluate your progress; do you need to make a monthly audit of how much you are saving towards the goal? At what point do you need to move the savings into the investment? Do you need to automate your pension scheme/education fund contributions to avoid penalties? 

If you do not think of scenarios that can derail your goals, then you will not come up with a system effective enough to hold you accountable. 

3. Be Ready for Emergencies

Be prepared for any kind of emergency at all times. An emergency fund is a lifesaver when things don't go as planned. Be ready in case of a medical emergency, layoff, or separation and divorce. A well-thought-out financial plan ensures that your priorities are met.

Remember, a financially accountable person is not in the habit of blaming others or the environment when things go wrong. 

4. Live Within Your Budget

Overspending is easy to do when you do not have a budget. Try to keep things as simple as possible. Do not give yourself the luxury of spending a large amount of money on goods that you do not need. If you're prone to making impulsive purchases, put away your credit cards. Carry only cash with you at all times.

Also, keep tabs on your financial situation. If there are reasons why you can't keep your spending under control, this can only be pointed out in the budget.

See the areas of your budget that could use some attention in order to make your financial goals more attainable.

5. What are Your Limits?

There are many demands on our money like lending to family or friends which can deplete our funds real quick. To avoid this, consider your own financial situation first to give you the right perspective of where you stand before lending money. There is always the possibility that a friend or family member will not return your money.

Using the limits model can be a great way to avoid overspending. It is a sort of budget in itself but rather than being itemised on what money will go to what purchase, you set the upper limits for the categories of expenditures you envision leaving more than enough for your savings and investments. 

6. Find a Community of Believers

These are people who share your views and whose financial goals are aligned with yours. If you want to stay on track with your financial goals, join a community of people who share your commitment. There are several benefits to having a financial accountability buddy to keep you on track.

7. Reward Yourself!

Reward yourself for a job well done. An effective financial accountability plan will have rewards embedded in it to keep you motivated. 

If you make periodic audits of your progress towards your financial goals, it would be great to time the reward (or penalty) at the same time. 

If the said reward is something that you care much about or really enjoy doing, then it should be sufficient enough motivation to hold onto your accountability streak. 


Living your dream financially is possible. Get into the habit of setting aside a specific time of day, week  or month to monitor your spending.

A debt-free future or a comfortable retirement plan is possible if you seek out every opportunity to learn about your finances and money management. 

Spend some time, not only talking to people who have a good handle on their money but also on seeking their help to help keep you accountable.

Dave Ramsey, author of The Total Money Makeover: A Proven Plan for Financial Fitness, notes that financial success is equal parts knowledge and conduct. Knowledge is not enough and for it to work, it has to be acted upon.

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Njenga has over 8 years experience in multimedia and business journalism both as a writer, editor and producer. He has over 5 years of experience in radio broadcasting as a news reader, reporter and presenter. He is also a 2012 Earth Journalism Network-EJN Fellow.

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