Low-income-earners: Upgrading to Medium Income Class- The Action Plan

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Thursday, September 11, 2014 5:14PM / Taiwo Ologbon-Ori, Research

  

The big difference between financial laxity and financial discipline is what a low-income-earner needs to figure out, learn and leverage on in his quest to upgrade his/her status to medium income class, and not necessarily looking for high paying jobs.

 

With this, I mean self-discipline, which is regarded as basic requirement in boosting personal finance i.e. one must be self-disciplined to save and invest, without this it would be very difficult to grow out of low-income class.

 

Growing out of low-income class actually requires discipline to learn how to Think Outside The Box- which further suggests your current job alone cannot take you there. In the real sense of it, your job is designed to keep you till month-end ('Just Over Broke') not to make you rich or wealthy.

 

In this sense, you may need to combine your knowledge of personal finance, the power of passive income and other personal finance tips that we had already discussed in our previous articles- this is necessary because you need to generate more money in order to upgrade your status to medium income.

 

The simple truth is that you need to generate more income steadily to achieve this status- like I mentioned above, you may need to explore the power of passive income ideas. In this case, you need to learn how to face your job and at the same time mind your business squarely. You must find how your business would not disturb your job and vice versa- this is very important to know and understand the consequence of not taking this serious. Below are recommended plan of actions towards upgrading your financial status.

 

Recommended Actions for Upgrading Your Financial status
·Manage your finances constructively- this remains the best way to increase your net worth by tracking your finances i.e. both inflows and outflows

·Have a side business- the power of passive income, you will need to learn the act "Face your job and mind your business" just as advised above. Think of businesses that would require little of your time.

·Join a corporate cooperative group and do a direct savings from your income into your cooperative account

·Be disciplined, Invest regularly and avoid extravagant living and flashy people/friends

·
Live in a low cost region, start with small apartment and you may go for larger apartments as your income grows large.


·Buy a modest and cheap-to-maintain car and home appliances

·
Bring lunch to work- you may find this difficult but it will save you lot of money. The cheapest lunch on island may cost N500plus


·Spend more on needs-not on your wants and always compare prices before buying.

Conclusively, it is important you designate part of every salary to saving &/or investing. Start saving and investing NOW, no matter how old or young you are. You are strongly advised to earn more than you spend and invest the difference wisely.

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