Mismanagement of funds is one problem that causes seasonal wealth. Seasonal wealth in the sense that you have money today and tomorrow you do not have because of inadequate planning, extravagance and poor management of funds. Growing up, my mother used to tell a story that was titled “ Had I Known”. This story was about a man who used to work as a federal director of Coca-cola company. He made a lot of money from the company and was known to be one of the richest men in the states as at that time. During these years of bloom and wealth, he forgot that his Job was a contract Job and would only last for a period of seven years. He failed to plan for his life after his job.
His misfortune came almost immediately after his contract was terminated. He stopped getting the kind of money he used to get but at the same time did not reduce his expenditure, so his cash outflow became way more than his cash inflow leading to loss of his wealth over time. His money went away because of his spending habits, he did not invest in anything during his glory days and because of that, he went back to square one with age not on his side to put his life together. He made it his duty to tell his story to young entrepreneurs and young people as a whole, as he wept “Had I known”.
This is a kind of story we would not want to tell young people when we are older because its a sad one and one caused by extravagance and poor money management. Below this paragraph are some three strategic ways you can manage your funds for sustained wealth.
Your income hhould be greater than Expenditure
This is simple mathematics. When you spend way more than you earn you may run into bankruptcy. Always have a budget and also develop a habit of working with your budget. Cut Expenses where necessary, only purchase what you need not what you want. Avoid extravagant spending, that doesn’t suit your budget.
Make Good Investments
On the national level in economics, savings is equal to investment but on a personal level in our daily lives savings is not equal to investment. When advised to make good investments, this doesn’t mean you should go and start saving, don’t get me wrong, it is important to save money but saving money doesn’t generate revenue and thus is not an investment. Making good investment is a very important strategy in money management, as a good investment would help grow your funds and keep you in wealth.
Ensure new money meets old money -Proper Savings
This is trick my father use to employ and advice people to employ because it has always helped him sustained his wealth. This trick is basically making proper savings and judicious use of funds. It is the idea that you should plan into the future and make sure you do not use all your funds in your savings account for unprofitable things. This trick basically means ensuring you always have already existing money so that any money you make in the future comes and meet the already saved one. This is a strategy that has helped a lot of people sustain their riches as they plan ahead of time in ways that would generate more money, as they do not want to have an empty account when the new money comes.