Last week I got a number of comments in response to my article on New Year financial blues, with several people asking cynically which pastor had paid me to advocate for tithing. While I believe that the discipline that goes with tithing did the trick for me, I am not ignorant of the fact that it may not work for everyone. However, the underlying factor of identifying your own system for financial discipline cannot be ignored. Those that saw the bigger picture, like my friend Immy Mulekatete said, financial discipline is going to her vision board for 2019, adding that, ‘financial discipline is imperative as it helps us to be aware of even our little expenses.’ I found that interesting because I am a big culprit of not accounting for little expenses, forgetting that they eventually add up.
While money tops New Year resolutions for many people, it is mainly based on how to make more of it and where to spend it with little concern for saving. This begs the question; if the jobs we currently have suddenly ended, how long would we survive before we are totally broke? Many of us would not survive long because we hardly plan for ‘rainy’ days. With that in mind, Isaac Nkusi was at it again last Wednesday, this time talking about the habit of saving for investment and future consumption. He highlighted the issue of paying-self first. This got me wondering about how I can pay myself first when I have taxes, rent, loans to service, among many other competing demands for my money. In an attempt to justify my regular behaviour, I asked Isaac whether fulfilling my financial obligations qualifies as payment to self and the answer was a vehement, no. He said that it is okay to have those needs and be able to cater for them but they cannot replace a ‘salary’ to self in form of saving. According to Isaac, saving should not be seen as an ‘extra’ but as a priority if one plans to achieve financial freedom. He argues that if your bills and debts cannot be paid after you are done saving, then there’s a serious problem with the way you are spending your monthly income. He emphasised that whatever amount one saves isn’t what is important, but that one saves and understands that saving is in fact paying oneself. To save we must earn first, and if you feel saving from what you currently earn is an uphill task then you need to start finding ways to earn more.
To help us in our quest to earn more and save more, Isaac discussed alternative income streams and it was good to see some which myself and others that are in full time employment can do comfortably without the risk of underperforming at the main job. The first one was affiliate income, which he explained as income you can earn by identifying and connecting potential buyers (your affiliates) to sellers. For instance, you may know someone who sells craft items, furniture, clothing, cars, land and etcetera; find them market for their items and after they sell the pieces you can earn a commission. You can also earn from buying and selling property and other items at a profit, known as profit income. Other streams include dividend income which you can earn from investing in stock, and royalty income which you get from others using your idea. I know someone who had a grand idea of setting up a hatchery but did not have the resources to do so. When he sold his idea to an investor, he was made a shareholder of the company and is now running one of the biggest hatcheries in the region.
Overall, there is need to be on the lookout for alternative income opportunities and to take initiative whenever they arise. I wish you all the best in your journey to financial freedom this 2019 and look forward to hearing your success stories.
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