Savings, Thrift & Investment | |
Savings, Thrift & Investment | |
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Thursday, January 07, 2021 / 2:54PM / By Bukunmi Adejobi, Proshare Research, and Taiyese Nifemi WebTV / Header Image Credit: iStock/Getty Images
Budgeting is a strategy that entails creating a plan to spend your money on the journey to financial freedom. In the maiden edition of the Millennial Talk, the programme anchors discussed why, when, and how to plan personal budgets.
For millennials who want to attain financial freedom, the anchors observed that budgeting is a financial lesson that cannot be overemphasized. Building wealth over time through the committed study of personal finance, and the development of financial intelligence skills is crucial for young people preparing a stable future for themselves. The anchors noted that "time is a short-stay guest, and the earlier young people build lifetime plans and personal budgets the better for them. Growing old could be great or terrible depending on the habits you acquired when you were making millennial choices".
One of the anchors, Bukunmi Adejobi noted that "the mindset that most people have about budgeting being associated with poverty, selfishness, or lack is one that should be changed through constant financial reorientation". She insisted that 'budgeting is not a negative idea', she noted that it does not mean people should not spend money, it means that people should spend money on needs rather than wants.
According to the programme anchors, budgeting is important because it ensures
that individuals' do not spend
more their incomes, thereby creating avenues for saving
which in turn provides individuals with the capital needed to invest and earn returns above the inflation rate.
With the unemployment rate in
Nigeria at 27.1% in Q2 2020 according to the Nigeria Bureau of
Statistics, Nifemi Taiyese noted that "this has motivated innovativeness and vibrancy
among millennials who have increasingly developed business ideas as
SMEs that have turned out to be champions in
their chosen sectors. Adversity has bred creativity among millennials" Taiyese
said.
Taiyese, further noted that budgeting for young entrepreneurs was quite different from their older counterparts as most business owners deal with fluctuating income. Adejobi observed that the first step towards intelligent personal finance was to separate business from personal financial obligations. She said that it
was important that millennials engaging in meticulous record-keeping and financial planning
based on projected cash flows including minimum monthly income. This, according to Adejobi, would help
millennial businesses to
attain growth and sustainability whilst ensuring that the
business owner meets with his
or her other obligations.
Due to the novel coronavirus (COVID-19) pandemic in 2020 which has prompted a rise in remote work, millennials must note that as they plan
their budgets for the year, they need to emphasize
digital accessories such as laptops, phones, and the internet;
data, airtime, and Wi-Fi. Other recommended budgeting
categories should be household expenses, salaries to workers, entertainment,
charity, transportation, self-care,
savings, online courses,
and investments.
Also, the
two anchors explained that there was a need to create a flexible and realistic plan that includes a spending forecast for the year that could help with long-term financial planning. The following
are tips to follow in the desire to stay on a budget:
The 21st century
and the advancement of technology have introduced several applications
developed by software experts which makes financial terms and activities such
as budgeting to be made easy. A few APPs that can
be downloaded for a digital experience to help in budgeting and tracking
expenses include;
Free courses on how to create a budget
can also be accessed on clevergirlfinance.com
Budgeting comes with a huge deal of
sacrifice, self-discipline and, delayed gratification. To make an effective budget, individuals must be willing to work with detailed
and accurate information about their earnings and
spending habits, craft a financial vision that
motivates them while
starting to adopt better money management habits designed
to achieve financial goals.
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