Greetings, and welcome to the seventeenth edition of Wallet Wellness in 2024 - your midweek source of practical financial tips to elevate your money management skills!

We hope you had a chance to check out the last edition where we explored money shame and how to overcome it. In today’s edition, we will discuss money beliefs keeping you broke.

As always, be sure to check out the Concept Corner below for a deep dive into the money concept of the week.

Let’s dive in!

MONEY254 TIP OF THE WEEK

🔓Unlimit Yourself: The Money Beliefs Keeping You Broke

In a world where wealth seems elusive for many, it's easy to blame external factors for our financial struggles. But what if the real culprit is lurking within us?

What if our own beliefs about money are the chains holding us back from abundance?

Imagine if the key to unlocking financial success lies not in earning more, but in understanding and reshaping our deep-seated money beliefs.

Today, we'll explore some common money beliefs that might be keeping you broke. By understanding and changing these beliefs, you can take control of your finances and start on the path to a better financial future.

1. “I Will Start Saving Later, When I Earn More”

This simply means putting off saving for when you have a higher income. As we have witnessed in recent months with the rising costs of living, our incomes may tend to shrink rather than grow and what does that mean for the savings plan? It will continue being non-existent.

• Consequences:  Not saving means you're likely spending everything you earn each month. This makes you vulnerable to financial shocks and can trap you in a cycle where you're always struggling to make ends meet.

• What to Do: Start Small, Start Today: Start saving what you can now even as you await an increase in income. Learn more.

• Set up a savings account and commit to putting aside a small amount regularly. Automate contributions to this account. 

2. "Budgets Are Restrictive and Limit My Freedom"

This belief suggests that budgets are constraints rather than enablers of a planned financial life. You may feel that sticking to a budget restricts your choices and you’d rather be more spontaneous since “you know what you want”. Read more.

• Consequences: Overspending: This is a common habit of people who have no budget and consequently leads to financial instability. 

• What to Do: Change Mindset: By viewing budgeting as a tool for empowerment rather than a restriction, one can better manage their finances. Start with simple budgets for beginners such as the 50/30/20 rule.

3. “I earned This”

This depicts a mindset of entitlement or justification for certain financial decisions or outcomes. It might indicate a belief that one deserves to spend money on certain things because of their hard work or accomplishments.

• Consequences: It can contribute to a cycle of overspending and living beyond your means, ultimately leading to financial struggles and the risk of being broke. 

• What to Do: Mindful Spending: Instead of splurging on every desire, adopt a mindset of financial responsibility and long-term planning. Learn More.

4. “My Neighbours Have It, Why Shouldn’t I?” 

This reflects a mindset driven by comparison and keeping up with others. It implies a desire to possess similar things or lifestyles as those around you, often leading to financial decisions based on social comparison rather than personal needs, goals and financial stability.

• Consequences: This can keep one broke by encouraging them to overspend and live beyond their means in an effort to keep up with or surpass their neighbours' lifestyles. 

• What to Do: Avoid Comparison: Refrain from comparing your financial situation to that of others. Everyone's financial journey is unique, and what works for one person may not be suitable for another.

• Set Personal Financial Goals: Define your own financial goals based on your values, priorities, and long-term objectives. Learn more.

5.  “I need a Bigger House”

This implies that one's sense of security, status, or satisfaction is tied to living in a larger house. Once someone feels they can afford a bigger house, they might move into it without proper financial consideration, often leading to ongoing financial strain and remaining broke.

• Consequences: Financial Strain: A bigger house means bigger bills. Moving to a bigger house without considering long-term affordability can lead to challenges if financial circumstances change. It may hinder your ability to save and invest too. 

• What to Do: Think Long-Term: Consider the long-term implications of living in a bigger house, such as how it may impact your other financial goals.

6. “I am Just Not Good With Money”

This belief shows a lack of confidence in one's financial skills, suggesting that handling money is tough or out of their hands. It suggests that one feels they don't have the discipline to manage money well, which might lead them to avoid improving their financial skills. 

• Consequences: This belief can lead to a lack of effort or avoidance in improving financial skills resulting in poor financial management, including overspending, not saving enough, and making uninformed financial decisions. Read more.

• What to Do: Change Your Mindset: Challenge negative money beliefs and replace them with positive affirmations for confident money management. Learn More.

• Educate Yourself: This can include reading books, taking online courses, or seeking advice from financial professionals to learn about personal finance.

7. “I Don’t Need Insurance”

We often consider insurance expensive until we are in a situation where we have to pay for something unexpected out of pocket. Until then we believe that one can manage without insurance coverage for various risks or losses. 

• Consequences: High costs in emergencies and lack of protection: Without insurance coverage, one may be responsible for paying high medical bills, repairing or replacing damaged property, or covering legal costs, which can lead to financial strain and debt.

• What to Do: Assess your Needs: Identify potential risks and understand the financial impact of these risks.

• Research: Explore insurance options that align with your needs and budget and make a plan towards getting adequate insurance coverage. 
  

Our beliefs about money shape our reality more than we realise. Imagine a future where saving is a habit, budgets empower us, and comparisons fade in light of personal goals. 

In this world, house size doesn't define happiness, and "I'm not good with money" is a thing of the past. Let's bid farewell to scarcity beliefs and embrace abundance. Together, let's rewrite our financial narratives for prosperity, one belief at a time.

After all, the greatest wealth lies not in what we have but in what we believe we can achieve.

CONCEPT CORNER

70/20/10 Budget Rule

The 70/20/10 budget is a percentage-based money management strategy that allows you to allocate your income into three categories;

• Monthly expenses (70%)

• Saving/investments(20%)

• Paying down debt(10%).

This method is ideal for anyone with many expenses, living paycheck to paycheck, or struggling to service their loans. Learn More.

Money and Me

I Took a Loan to Become the New “Bazuu wa Mtaa”‍ 

“I could no longer keep up because I was getting choked up by debt and keeping up with the expensive life. Before I caved in, I remember one time my kids did not go to school for a month for lack of school fees… Honestly, when I recount those moments, am grateful my wife stuck around because things were thick!...” Read More 

MONEY254 #MONEYTOK

How Stable Is Your Financial Situation?

Would you consider yourself a financially stable person? What does being financially stable mean? In today’s MoneyTok, we explore 4 signs that you show that you are a financially stable person. Watch The Video and read more about it here.

@money254hq

𝐇𝐨𝐰 𝐬𝐭𝐚𝐛𝐥𝐞 𝐢𝐬 𝐲𝐨𝐮𝐫 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐬𝐢𝐭𝐮𝐚𝐭𝐢𝐨𝐧? Before you give us your answer, have a look at the signs of a financially stable individual and le... See more

That's it for the seventeenth Wallet Wellness edition of 2024! We hope these financial tips have added some energy to your mid-week hustle. Stay tuned for more practical insights in our next edition of "Wallet Wellness" next week and watch out for Money Weekly on your inbox this Friday.

Also, don’t forget to download the Money254 App on the Google Play Store, and remember that we can help you compare over 300 loans, savings accounts, current accounts, and more if you’re thinking about your next product.

Cheers to your wallet's well-being!

Money254 editorial team.