When companies do strategic plans they build road maps for 3 or 5 years down the lane. The same thing needs to happen when we create Personal Financial Plans; we need to think ahead. On that note, we need to plan to earn more money. If in your plan, you are saving Kes 10,000 this year, next year plan on saving Kes 15,000. To do that income must have increased somehow. In the class I run on creating financial plans, this is where major mindset shifts occur. A lot of us have been conditioned to rely on someone else to decide what to pay us so the thought of planning to earn what you need is completely foreign. Remember, you may have a job or you may have a business but what you want to achieve is very personal so we have to grapple with personal responsibility over this area. For many, thinking what they would actually do to make more money completely shifted the balance of control for them as it had always been someone else’s responsibility to decide what they earn – salary, bonus etc. Well if you have personal financial goals it is no one’s responsibility but your own to see them through.
What would you do if you knew that in order to educate your children, retire comfortably, buy your dream house you need to increase your monthly savings by an average of Kes 10,000 per year for the next 5 years? Would you really leave these monumental decisions in the hands of someone else – your clients, your employer etc? To be able to earn more money next year your actions start today. How are you performing at work this year so that you can justify a salary increase or bonus next year? Please note the fact that costs have gone up is no reason for you to get a salary increase. Personal responsibility means this has to be performance based. What new ideas on revenue generation will you implement for your business so that it can pay you more next year? What do you need to learn to enhance your skills so that your career and consequently financial abilities can go to the next level? We often want to do the same thing and expect a different result. This does not work! Can you find a way of generating an extra Kes 5,000 per month by doing something in the evenings or on Saturday’s? There are many ways to generate extra money but they all require getting out of the comfort zone and deciding that the money you need to earn is your responsibility and no one else.
We need to develop our own confidence that we can create income and it only comes from taking the first step. Getting an increased salary based on your measurable performance or creating that first extra Kes 2,000 starts to build that confidence. Do not discount the small things you can do. What is lacking in most people’s lives is the ability to make a decision (i.e. take responsibility) and follow these decisions up with concrete actions even if they do not conform to what others think you should be doing.
Waceke Nduati
The author teaches personal financial management. Find her at www.centonomy.com