Do you ever find yourself wondering if there is a hole your wallet? Perhaps termites are feasting on your notes? Are your friends comfortable with the idea of lending you money, or are you perceived as the rebirth of Pyram?

Trying to reassure yourself that your financial predicament is not your making is a normal phenomenon. In this article, I will try to share some few tips that will help you know how to manage your finances.

Tip: Your balance sheet should have more assets than liabilities and those assets must be earning income for you.

Like a company, everyone has a balance sheet detailing one’s assets and liabilities. Assets are basically the things you own that have the ability to generate income for you, whereas liabilities are the things you owe other people that will result in a deficit in your resources. Your assets could be your savings and investments, properties, business and most importantly, your knowledge store. Your liabilities include utilities that require settlement, mortgage, church obligations, etc.

Your assets minus your liabilities tell you how much you are worth.

Tip: Make sure you have whatever you purchase in your budget. Increases in your disposable income should not result in increase in expenditure. Invest the surplus income.

Do you find yourself always matching your living expenses with every pay rise or increase in income? Should that really be the case? Do you put down the list of items you need at any point in time? Are you in bed with impulse buying?  Are you always giving out stuff that you purchased recently because you no longer have use for them? The beneficiaries of these items will certainly have good words for you, but guess what? You have a problem.

Tip: Get paid what you are worth and spend less than what you earn.

How much are you worth to your organization? Have you ever evaluated your skills set, contribution to your organization and what you are being paid? No matter how much or little you are paid, your financial life will be in a mess if you spend more than you earn. It is relatively easier to spend less than it is to earn more. Having a cost-saving lifestyle can result in big savings.

Tip: Pay yourself first!

This may seem to be a platitude but it is still relevant.  Get yourself paid before you spend a dime from your income. You could decide to set aside 10% of your monthly income aside as your savings. An efficient way of doing this is to maintain a standing order on your account that takes this amount from your account into an investment account. You could then plan your expenditure on the balance in your account.

I cannot help but add that he who waters will himself be watered. Make it a point to have a portion of your income dedicated to helping the under privileged and to the things of God. Of course, you would not find this in any textbook. It is purely Biblical Finance. If you doubt me, I will just urge you to TRY it.

Follow these steps and you will move from wondering where your money went to actually knowing what you used it for.

Joseph Ciici Arthur, Financial Controller, Agricultural Development Bank