To promise means to undertake that you will bring an action to the end, without regrets and without a doubt.
- When was the last time you promised to do anything?
- When was the last time you promised something about your financial status?
- When was the last time you made financial promises to yourself?
- Did they come true?
These are only a few questions I would ask you to answer before reading further the 10 financial promises I would recommend to you.
Me, personally, each time I made a promise to myself, I went along with it until the end, without any pretext or idea to back off.
I personally believe that being honest, being coherently in all you are saying and keeping your promises are only a few of the elementary things each person should have, regardless of what he/she does.
Hereafter I will present to you 10 financial promises I made to myself and which I would like to share with you.
10 financial promises you have to make to yourself
1. Manage your money with the help of a personal budget.
It is one of the most important promises I made to myself now. Everything I spend, everything I earn, I put in that budget (it is an Excel sheet).
This tool helps me be organised about the money I have and plan each financial transaction I want to make.
2. Constantly have at least 3 income sources
Another promise I made to myself is to constantly have 3 income sources. I really believe that 3 income sources is optimum for a person.
You can never know when one of them may fall and you have to remain with the others.
Never rely on only one income source. It is very risky and, if it falls, you will find yourself in a quite big difficulty.
Always think on how to diversify your income sources!
3. Save 20% of the income.
My objective, at this moment, is to save 20% of everything I earn. Why 20%? Because, to me, it seems the best and the most realistic percentage. The remaining money goes to daily, mandatory expenses.
I will try to invest the saved amount in equipment/software which make my job easier of in various businesses.
An article which I recommend for you, related to this subject, is: How to save money? 10 practical ideas which help you save more money
4. Never end up having debts
Rule no. 1 – never be in debt. I have promised myself that regardless of my financial status I will never end up in debt.
To have debts not only means that you have to return an amount of money in a certain timeframe, it has also a psychological aspect.
If you have debts right now, you will always have debts. I do not want to end up in that situation, neither do I recommend it for you, that is if there are any other ways to get away.
5. Always observe the expression: INCOME > EXPENSES
Rule no. 2 – Income should be always higher than expenses. Regardless of occasion, moment, month or day, this rule must be observed.
This rule should be a lifestyle for each of us.
6. Buy only the products I need, not the products I would like to have
It is a quite important problem in our life. Each time we go shopping, we buy more than we need. We buy even what was not on the shopping list just for the sake of buying and to fill the shopping cart.
Wrong!! Lets buy only what we really need, not what it would be nice to buy. We buy only what is on the list, nothing more.
We go shopping with the list we made at home and we stick to it until the end (maybe we even cut out some things on it).
When it comes to electronics/household appliances, think if you really need them. Will they make your work more efficient? Is there another cheaper alternative? Do you really need it/them to be new?
Each time, buy only what you need, not what you like!
7. Invest money in things which help me develop myself personally/professionally even more or which make my work more efficient.
Where is the money you want to invest going? Is it going on things which are beneficial to you in the future?
Are you going to earn more as a result of your investment? Are you going to be smarter? Will it make your work more efficient?
Make sure that the investments you make help you develop yourself more or you have a material benefit right after.
8. Never lose money randomly, on irrelevant product/activities.
Rule no. 3 – never waste your money on irrelevant product/activities.
If you like a product, think if you really need it or not.
If you want to take part in an event, will it help you in your career/work?
Do not waste money on things which are not beneficial to you. Always think about the benefits!
9. Analyse your financial history each month
Personal financial analysis is very important. If you have a budget where you enter all your planned and made income and expenses, when it comes to analysis, it will be very easy.
You will know immediately where your money went, if they were spent on things that are beneficial to you and how much is left.
After analysing your previous month comes the nicest part, namely: planning the next month.
10. Try to donate/offer a small part of your money you make as appreciation.
One last promise I made to myself is to donate money.
Not necessarily to people I see on the street at each corner and every week, but to certain foundations/organisations which have a beneficial cause for society.
I, personally, will try to donate money to organisations dealing with the development of youth and society.
BONUS. Before making any promise, try to think very hard if you can go all the way.
What financial promises have you made to yourself this year? Are you ready to keep them?