7-Step Guide To Spending Your Naira Wisely

As we continue to raise the discourse on women’s issues, all of this week, we publish something from another of our female guest columnist, Alorye Ugar who pens us a few useful money tips for the woman.

Whether it is too much debt or too little income, the lack of savings, loads of unsettled bills, financial challenges can be stressful. And since simply ignoring them is not going to make them go away, becoming wiser with your next purchase or future spending pattern will go a long way to easing you of your stress and possibly setting you up for a better financial future.

Is there a way to spend that will qualify you for less stress and fulfillment of your needs at the same time?

Hopefully, the answers to the following questions should help you if you desire some form of peace and satisfaction for life:

1. Is this an emotional purchase?

You have the right to every kobo that you earn legally but what you do with it will go a long way to making you feel better about your spending afterwards.

Is your purchase driven by your emotions? With the quality of advertisements and marketing strategies these days, a lot is done to appeal to one’s emotions when making a choice of what to or not to buy.

You, deciding earlier on if your intended purchase hinges on your emotions is very germaine in deciding where to put your hard earned cash.

Are you buying what you don’t need simply because others in your circle of friends possess this item and you want to impress?

Buying a car simply because you want to fit in, which will place a corresponding financial obligation on you as against buying a car because you need it and it will be useful to you. One is a liability, the other an asset.

Are you buying simply to fill a void? When do you tend to spend the most – when you’re happy, sad, depressed or in love?

Or is it a mindset purchase – “Life is too short not to spend it on what you want” mindset?

Emotions drive money and remember that you spend money every day whether you stay at home or go out, so keeping your emotions in check will go a long way to helping you maintain a financial balance and avoid being broke

2. Are you currently in debts of any kind?

Consumer debts have become one the world’s most crazy financial tragedies. Before you spend your next naira on that big purchase or the next flashy thing that your eyes come across, ask yourself who you owe and how much?

Can you start to pay off some of your debts? Even if you have to break your debts down to monthly payments, it is better than letting it linger, while at the same time incurring interests on your debts.

Avoid future debts. If you have to buy an item on credit then it means you can’t afford it.

Earn more income if you have to but start from what you have.

You might think that your debts are too huge to repay so you push the thoughts of doing anything about it to the back but making the first move of deciding how much it is you owe and coming up with a debt repayment plan might just be difference between becoming a career debtor or a financially free individual.

3. Do you have any saving/investment plan in place?

Sometimes building a strong foundation requires sacrifice so asking yourself the above question is very vital to setting you on the right track to a more secure future.

Do you have a saving/investment plan in place? When are you going to start one? You don’t need so much money to start. You need the right habit and attitude to start saving and investing for your financial future.

Do you have a fall back savings? If you don’t want to continue living from hand to mouth start a saving plan. Do you have any investments or an investment goal you’re currently pursuing?

Will buying this item affect your plan?

This is one key to your awesome financial future. Every income has the potential to propel your financially free future so multiplying your income is a no brainer. You don’t also need lots of money to start. Approach a money market to start with. Attend financial workshops and get financially literate on the various forms of investments there is.

4. What do you need right now?

Don’t just run off shopping without determining what indeed it is you really need. Is this simply a want or a necessity?

When it comes to making choices especially when resources are limited, you need to start from what you can’t do without.

Are you about to purchase something you can get later at the detriment of an item that is more important?

Having a guiding list or spending plan will go a long way to curtail excessive shopping. I use what I call my Ultimate Shopping list. This list contains everything I currently want to buy covering various aspects of my life – home (kitchen, living room, bedrooms, etc.), family, personal purchases and so on.

This list gets updated but as far as purchases go besides my daily living expenses and emergencies my Ultimate Shopping list is my guide for peaceful shopping.

5. Do you already have this item you want to buy?

Various reasons make a person want to duplicate an item they already have. Sometimes, they have so many possessions in a small place and so lose touch with what they already have.

So the question of what you already have becomes important. Maybe organizing your possessions might help you readily identify what you currently have so as to avoid duplications and unnecessary spending.

Also, Is there an alternative in your wardrobe, home, etc.? Maybe it’s not the same exact item of course, but can this other item substitute well for what you’re considering buying.

Shouldn’t you be simply buying the right top to compliment the pants you already have in your wardrobe as opposed to buying a new dress while leaving the pants still not in use?

Also a not popular but obvious tip to spending your money wisely is to take care of what you already have: This will reduce the need to replace it therefore giving you the opportunity to redirect your funds elsewhere.

Start from what you already have. Determine what you need from what you already have.

6. Can you sincerely afford this purchase right now?

Spending less than you earn is like the foundation to growing wealth. Wealth is an accumulation of something – money, friendship, good health – you name it, that you place value on.

That is, it becomes so much that you have abundance and you may not need to earn more of it at a certain point in time. It just keeps multiplying itself. But you need to put some work towards it at a time.

Wouldn’t you rather save for an item you really want to have than burn all your cash now and be broke in the future?

Your ability to delay gratification will help you in deciding whether you can truly afford to buy an item per time or wait till a more convenient time.

This isn’t about earning more money. If you have the bad habit of using up in a day all the resources you need for a year, you will never be financially free.

7. Do you truly love and will use this item and will buying it give you joy?

Since I learnt to place value on what I spend my money on, “curating” my spending has been the way to go for me. Spending your money in a way that gives value to the things that are more important to you is the ultimate recipe for joy, contentment and excitement, peace of mind.
Is this an item that will be useful and not just take up space in your house?

When you constantly surround yourself with the things you love, that is, the things you truly cherish and will use, your spending makes a lot more sense. You get the best value for your money.

Don’t buy simply because it’s in vogue. Don’t buy for the sake of buying. Buy curated items for your home. That way you will be selective of your purchases and not spend impulsively.

By doing this, you will avoid the situation of “after purchase regret.”

Clutter most times is evidence of wasteful and unplanned spending.

It is better to save enough money to buy the quality that you love and will use for a long time as against simply buying just anything that you aren’t truly excited about purchasing.

Provided of course, you aren’t simply buying an expensive brand over an equally good quality product but less expensive.

So how wise is your shopping? Do you ask yourself any of the 7 questions before shopping.

Alorye Ugar is a professional accountant and wealth productivity strategist who is passionate about helping individuals find clarity and focus in their wealth and productivity goals. You can see more of her work at www.aloryeugar.com