7 Tips to Mastering Money and Managing your Finances

Money, money, money…it’s a vital part of our human existence. No matter who you are or what you do…money affects you. It is the means by which our world operates, whether we like it or not.

It’s funny, as an accountant who is so on top of keeping track of the finances of others, it hit my husband and I a while ago that we weren’t keeping track of our own!

Since getting our personal finances under control, it’s been SO good to see where our money is going and implement changes that needed to be made.

Here are a few tips that have helped us and may help you manage your finances:

1. Get a system in place.

If you aren’t a math expert or if you’re not good at numbers — don’t freak out! A lot of people tell me, “Oh, you’re an accountant—you must be so good at math!” (Classic response—I get it all the time. I’m the friend that everyone hands the bill to at the end of a meal at a restaurant…you know, one of those people). But that’s not the case at all. Bookkeeping is more about organisation than anything else and having and using a system is crucial!

If you really want to get yourself in order, there is awesome cloud-based bookkeeping software out there that allows you to easily import your bank statements if you REALLY want to get into it. Otherwise, I recommend getting a nice Excel spreadsheet in place that you can plug your numbers into. If you need help creating one, I’m happy to help.

2. Track Your Income.

If you work for a company, this may be super simple for you to do. But if you’re self-employed or have multiple income streams, it’s important to track your income and record exactly where it’s coming from. This will be handy come tax season.

Diversifying your income is a great way to master your money. We live in a volatile economy and having multiple income sources is an excellent safeguard. Whether it’s creating clothes or jewelry on the side and selling them at markets, or buying a house with the idea of renting it out (passive income, aka having money come in without much effort, is awesome!), coaching rugby in the evenings, or becoming an instructor and giving classes — whatever it may be, try to find some clever ways to create multiple income streams. Especially if you can use your already loved hobby as a form of income. It’ll add some excitement to your life and you’ll be able to generate money whilst still having fun!

3. Track Your Expenses.

This is a nasty one…it really makes some dirt come to the surface… but it’s a great way to see where changes need to be made. How much money do you spend on petrol each month? How much do you spend on groceries? Eating out? Shopping? Drinks? Those nights out on the town or sneaky trips to the little shop on the corner may be costing more than you think!

4. See Where You Can Make Cuts.

Don’t get me wrong—tracking expenses doesn’t always mean that you need to make cuts. It’s YOUR life and you can decide what you want to spend your money on. It’s all about your priorities. If you enjoy eating out—by all means spend that money eating out each month. But maybe you’re spending more than you think on things you don’t really value. Keeping track of your expenses is a great way for you to evaluate your life and your priorities, and see if your spending patterns fall in line with what you care about most.

5. See Where You’d Like to Make Increases.

We are such an incredibly privileged society. The fact that you are reading this blog means that you have internet or data, you have a cellphone, laptop or ipad… do you know how rare that is in the world?! Take advantage of the opportunities you’re given! Perhaps you can be using some of your income to invest in your future like taking a language course or a photography course. Or perhaps you can invest in a local charity that supports a cause you’re passionate about. If you’re looking for one, I highly recommend Rural Reach (link to www.ruralreach.org). A non-profit organisation that brings basic necessities to the rural communities in and around South Africa. This one is just an example—do your own research and find one that sparks your interest.

My husband and I also set aside a portion of our income each month to help someone else in need. And it doesn’t need to be much! Even R200 or R500 can make a HUGE impact in the life of someone who has nothing.

6. Set Goals.

 By tracking your income and expenses, you’ll then be able to set financial goals for yourself or create a budget if you wish to do so. This is a great way to stick to your priorities and make sure you’re living the kind of life you want to lead.

7. Have a Greater Mindset.

When you start “mastering” your money, it can be very easy to become consumed by it. My last and greatest tip is to have a greater mindset. My husband has a tattoo on his arm of the Bible verse from Job that says:

“Naked I came into the world,
And naked shall I return”

It has been SUCH a good reminder to us, in times of need and in times of wealth, not to be consumed by money and earning more. Whether you’re a Christian or not, always remember that life is short, and while we need to be wise with our money and learn the art of “mastering” it, we must not let is consume us.

If you need any help with the above—reach out to a friend who shines in this area or you’re more than welcome to contact me. Managing your finances is a great way to live the life you want to lead and will help set your heart at ease knowing there’s a plan and structure in place.