You may have started saving or haven’t yet. Today I’m writing for those who struggle with this practice. It’s never too late to start. You may think it’s not easy because everytime you try you fail. Whenever coins pop up, they come with “necessary” needs. I know because it’s been hard for me too. And it hurts when everyone knows that you have a good paying job or you earn something every month (even a bursary fee) but at the end of the pay’s week you can’t find 5,000Frw to lend a friend.

However hard it seems I want you to know it’s possible. Let’s see together steps to take to achieve it. The first thing you need to go on with the following steps is  a notebook and a pen to track down your financial life. Or else install a budgeting app and use the notebook app in your phone.

  1. Assess your financial situation

The first step is to identify how much you earn, how much you spend, how much you own and how much you owe.

In your notebook,

  • make a list of your sources of income. They may be: salary, bursary fee, tontines, shops,..
  • make a list of your expenses. For example: rent, food, airtimes, saloon, dates,..
  • make a list of your assets (things that put money in your pocket). They may be: a house, a car, savings account,…
  • make a list of your liabilities (what you owe to others). For example: personal debts, house loan, car loan, student loan,..

Make your own list and this will help you to track your expenses and earnings.

2. Put yourself on a budget

Write down how much income you have coming in every month as well as necessary (basic) expenses. If you’re spending more than what you earn, it’s time to start cutting all unnecessary expenses like eating out, subscriptions,..

The budget will help you to know this and as time goes by it will be easier to make adjustments on your budget.. learn simple ways to reduce your electricity bills for example.

3. Start an emergency fund

Create a savings account where you’ll put a certain portion of your income reserved for those crazy events that life throws our way. Events like losing your job, getting sick, friends getting married,..

After you have made your budget, now you know where the money is coming from and where it’s going, add on an emergency box every month until you reach your goal per year. Remember we’re starting with small portions.

As money starts to accumulate every month you’ll see how good it feels and these small successes are the little stepping Stones that motivate us to stay in this savings path.

4. Pay of debts

One of the obstacles to savings is debts. When you clear about your expenses and earnings, set a goal on how to save your debts. I advise to start with the small ones. If it’s hard to cater for them, remove some of your expenses to be able to pay this. This will help you reduce some numbers on the what you owe column.

5. Make saving automatic

This is the part where you make the crucial decision. Challenge yourself, depending on what you earn, to always take aside 10%, put it on an account and forget about it. If you’re a salaried person, make an arrangement with your employer to transfer the 10% to that account as you get paid. If you’re a wage person, make it a habit/goal  to first put aside 10% of your income. Same with students, children at home (who get pocket money),…

Now that we have seen the importance of saving and how to do it, it’s high time we practice it. It’ll help you get control of your money. Manage when, how much and where the money is going. This way you’ll avoid any temptation of spending your money unnecessarily.

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