99 Problems, but Cash ain’t one
Money, money, money. Try to read that without singing ABBA.
Earning money can be challenging. Keeping it in your bank account can be even more challenging. Somehow, I’ve managed to do both across a variety of jobs ranging from barista to visual merchandiser, and oh so many more.
I thought maybe a pandemic was as good a time as any to share some of my tips with you. And they can apply to you, no matter what you earn, because as I said, I’ve been a student and an office worker, and have managed to get to as many countries, concerts, and classes as I like.
As much as I don’t encourage you to take your financial advice from your friendly, neighbourhood yoga teacher, I have managed to live a financially stress-free life. I have plenty of other stresses, but that’s where the yoga comes in, right?
Here are my top three tips for retaining the money you make, regardless of how much that is.
Tip Number One:
This is the biggest one. Don’t live beyond your means.
I’m going to use housing as an example, but this method could also apply if you’re trying to save for a vacation, or schooling, or whatever.
When you’re choosing a place to rent or buy, first figure out what your essential expenses are. Things like bills, petrol, groceries, etc. You don’t have to make a fancy spreadsheet or anything, just grab a pen and some scrap paper, and quickly jot down how much you roughly spend each week on your essentials. Round up. And because I’m not good at maths, I’m going to use big round numbers for the following example. Let’s say your essential (key word) expenses come to $300 per week.
Then figure out your weekly income, (again, for the sake of easy maths, let’s say $1000), and subtract your expenses from your income. You’ve got $700 left. Do you want to be spending $700 a week on rent or a mortgage? Probably not, because you have a life and want to do other non-essential things like drink wine and go to yoga classes and travel (when we can do all those things again).
That might mean that you don’t live in the nicest, newest house, with shiny silver appliances, but as long as you have a place to sleep and cook, and water that heats up, what are the other things you need in your home?
Which leads me to my next tip.
Tip Number Two:
Does it have to be brand new?
I have bought three brand new household items in my whole life. They are; big TV (because I love TV), a sofa on sale at 50% off, and a mattress. That’s it.
Does my living room look like a Salvation Army thrift shop? No. Because people throw away good shit all the time! Or they sell it super cheap.
You can get appliances that have nothing wrong with them, other than they’ve been scratched on the truck on the way to the store, that are a fraction of their perfect brother and sister’s price.
Second-hand furniture has personality, and generally is of a far higher quality than certain Swedish warehouse furniture (which is also so cheap/free if you can pick it up second hand).
Plus guys, on top of all this, buying second hand is much better for the environment as well as your wallet. Yay for Karma points.
And Tip Number Three:
Don’t ever finance a car. Ever.
Paying interest on an item that always drops in value is just a bad idea.
If cars are your thing, then ignore me and get your dream car.
But if you just need something to move you from one place to another, find a well-maintained, 4-5 year old vehicle that you know is reliable and can be repaired cheap.
Japanese cars, for example, are good on fuel and have cheap parts. Save up, and buy it outright.
If you must get a loan on a vehicle, pay it off as soon as is humanly possible.
If you’re nailing tips one through three, then amazing, go you!
Here’s another one that is much harder to maintain, because money in the bank is like an apple on a magical tree in a mystery land of two naked people.
Have an emergency fund.
It should be at least one month’s expenses, to begin with, and eventually build up to around 3-6 month’s expenses.
An emergency fund is much better off in an account that you don’t use on the daily. Something that requires a passcode and a text message from your bank is usually annoying enough to keep you away from it.
If this pandemic has taught us anything, it’s surely pointed out the things in our lives that we really use and need. Maybe there’s some stuff that, even during the most boring days of our lives, you still didn’t use.
Keep yourself financially stress-free by recognising when you’re going over the limit and seeing the value in what counts.
For all other stresses, go to yoga.