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Guys, what we're about to dive into will require discipline but will improve your situation by your own accord. Trust me when I say that it will take you further along the way if you haven't considered these tips before. I urge you to be open to the concepts I am about to share with you, so trust the process. Deal?
In this article, I will provide 7 Fruitless expenses to do away with. Let me scoop you in on the deeds for the name FRUITLESS EXPENSE: You see, for any tree, you nurture and grow, the point is to see it thrive, flower, and bear fruits. The same applies to our lives, we need to cut out fruitless activities that do not allow us to reap the fruits of our labor.
As a bonus, I’ll give you 7 Financial Tips-one for each fruitless expense that you can put into practice. These tips are derived from a book I read called The Richest Man in Babylon. "The Richest Man in Babylon is a 1926 book by George S. Clason that dispenses financial advice through a collection of parables set 4,000 years ago in ancient Babylon,".
So to begin, we all have a monthly routine, perhaps you buy that daily or weekly coffee, order take out once a week or buy clothing items that you probably pile up and wear only a few times -- until you hardly don't.
Let's be frank, tell me, have you worn every item in there for the past three months (given the appropriate season)? Chances are, some items haven't seen daylight for years. Yet you still find the urge to spend away on fashionable items.
Now don’t get me wrong, splurging on a new outfit has a feel-good response. That's your dopamine receptors making you feel all kinds of happy and fuzzy inside.
However, do you know what's more rewarding, young ladies and gentlemen? ...
Is it that very pricey splurge that will make you feel like 1000 bucks for one night, or is it that retirement fund that's piling up more and more money for you at the end of each month and year that will give you a nice nest egg to retire on whether sooner or later if you hustle hard enough? What is this concept called you may ask... compound interest!!!
In the book, The Richest Man in Babylon, there is one statement that resonates with me. "Make thy gold multiply.” In other words: Make your money make more money for you.
Isn't it the dream? To be financially stable, to pay off that study loan, and be debt FREE! We all have dreams to retire our folks, travel the world, donate to causes close to our hearts, buy a house or RV and go road tripping, take care of our health and invest in personal development that will take us to the next level, right?
Now, Ladies and Gentleman, if you’ve agreed to one or more of the above aspirations then this is an article for you!
Run............
Fruitless Expense 1:
Clothing! So, you’ve been exercising during quarantine and you want a new pair of jeans or that dress you have been dying to buy. You've taken a gander at the Lululemon, Good American, and Zara websites but think about it, is it a necessity? Yep, you know it is not.
According to financial analysis, 46 percent of young millennials, those aged 18 to 24, have $0 in their banking accounts. Older millennials aged 25 to 34 didn’t fare much better: over 40 percent have nothing saved. You don’t want to be part of these stats.
Financial Tip 1
Now, as soon as you get the urge to buy a clothing item, transfer that money into your savings account, and voilà, problem averted. You’ve just hooked up the future YOU with some savings to spare. Good on you, you deserve to be debt-free and be financially stable!
Create a savings account that cannot be touched for a length of time and keep pouring all your savings you would have spent on items listed #1 to #8 in this savings account.
According to CNBC, millennials say they spend an average of $478 a month on non-essential items. Imagine what that could mean at the end of a year. With that amount rounded off, that brings you to an average of $5,760 in 12 months.
So, every urge to buy that which you do not need, deposit! This will deter you from spending with no rhyme or reason and teach you about discipline and self-control. At the end of the day, you need to think differently about the savings. Think of it like this, the savings belong to the "FUTURE YOU", not the present you.
Fruitless Expense 2
According to a Business insider, on average you spend $2.75 to $5 per cup of Starbucks coffee. Meanwhile, if you brew your coffee at home, that will bring the total to 16 to 18 cents per cup. Considering buying a Starbucks coffee from Monday to Friday at $2.75, this accumulates to $55 in 20 days and $660 a year for 240 days. Now, that doesn't include the additional add-ons to the coffee and other food items on the side. Think about it, at 16 cents a day, making your coffee at home comes at a fraction of the price.
Financial tip 2
The Rule of thumb here is to NOT spend more than you make; living beyond your means simply won’t cut it. If you really want to be debt-free, cut out things like Starbucks coffee or any over-the-top purchase that you can easily make at home.
Fruitless Expense 3
Are unused subscriptions currently being used to get you optimum results and adding value in terms of health and wealth? Subscriptions to get your Birchbox or Scentbird every month may not be practical, and the tip below will give you some perspective as to why.
Financial Tip 3
You need to consider and determine whether the item you buy is a DESIRE or a NECESSITY. Don't let emotions cloud your judgment, this is your future after all. If the item falls under the DESIRE category, then transfer that amount to your savings; if it is NECESSITY then go ahead and buy it -- but be honest with yourself when determining which category the item falls into.
Fruitless Expense 4
Music Subscription:
Now I know we all love a good jam, but guys, is it paying you back in time and money? Let’s see, do you commute for 1, 2, maybe 3 hours a day listening to music? If so, level up on self-development by utilizing your time to listen to podcasts that are educational, funny, and enlightening.
Podcast topics range from business to self-improvement, art culture, health and lifestyle, marketing, to tech, you name it. You can easily find Podcast apps in the PlayStore and Apple Store.
A bonus to this is that most Podcasts are free. You can play them while commuting to work, traveling, cleaning your home, or simply taking a bath or shower. Now that's what I call maximizing your time.
Financial Tip 4
Resist the temptation to spend now that you have more money available. Chances are, now that you’ve cut other expenses out, you have more money to use. Instead, invest money in self-development and keep in mind "the why", why you read this article. In the back of your mind, you know you need to make some sacrifices. SO, revert to Financial Tips 1, 2, and 3, and focus on your WHY!! -DEBT-FREE-
Fruitless Expense 5
Gym Membership:
While I enjoy a good burn, quarantine has made me more resourceful. I use my couch to squat and bench press, I use 2-liter water containers as resistance weights when I squat, and I use cans of food to do arm raises. These are all things that can be found around the house. You spend between $50 to $65 on gym fees a month, that's a total of $600-$780 a year. And if you’re anything like my past self, you didn't make it for the full 12 months. What's worse is you probably skipped the gym for up to 4 to 6 months of that duration.
Financial Tip 5
Do your research and understand compound interest and how it can work for you. A consistent monthly transfer of all the gym payments and the 7 other Fruitless expenses into your savings put more frequently for 3, 6, 9, 12 months, or even longer will add up. Now imagine if you don’t cash out, but consistently put money away for items that were initially a DESIRE, not a NECESSITY (mouth drop, mind blown).
Fruitless Expense 6
Take out and Food Delivery. The total cost of ordering and delivering food items rack up to be pretty high (into the $100s if not the $1000s) at the end of the month. If you don’t believe me, list all the take-outs you’ve done, with a marker on your bank statement, and tell me this isn't true. When you get the urge, transfer that bad boy into your savings account. (YES, we are hoping this STATEMENT STICKS, so that every time you want to spend, you hear my voice in the background)
Financial Tip 6
Start preparing your meals at home and stop doing take-outs; put that money in a retirement fund, and create financial reserves for health and 6 months’ rent/mortgage. According to analysis, Thanks to compound interest, investing just $100 a month over 40 years adds up to more than $200,000, assuming a 6 percent rate of return”.
I read that over 40% of millennials aren't putting away anything for their retirement fund. So, be smart about your future. Now that you have money saved away, make provision to divide the money into financial reserves and retirement.
E.g. a money pot for living expenses that can sustain you for the next 6 months. One thing this pandemic has shown us is that a job isn't guaranteed. So, secure your future.
Fruitless Expense 7
Housing and wanting to live in an expensive and luxurious place might seem alluring, but when you’re on a tight budget, it simply isn’t practical.
Financial Tip 7
Buy or rent a home that is well below the minimum that you can afford yet still enjoy. Downsizing to a cheaper rental or home will come in handy. The extra $100 or $1000 going into your savings account every month for 12 months is a gift to your FUTURE SELF. It will serve you well if you need to enrich yourself with personal development or start a new business that will generate another income stream for you.
Well, that wraps up the 7 tips Guys and Girls, I hope this article has brought on a new perspective and game plan when it comes to money. Comment below on what you'll be using and Tag us on the results you've made down the line. Don’t forget to share these useful tips with friends so that they can level up their financial game too yah.
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