At least, not until we have a spending plan for the money.

Do you like the image above? I think it is apt for how we often feel in December.

It was Benjamin Franklin who supposedly once said, “If you fail to plan, you are planning to fail. I hope we plan not to be broke this December or January.

If you paid salaries yesterday and of course received yours (if you didn’t pay yourself a salary, you are on a long thing and I like to believe you missed my FREE 10 Step Guide on Managing your Personal and Business Finances, get it here 
How did it feel paying all that money to staff, contractors suppliers, e.t.c? Allocating for rent and other admin expenses? Were you expecting to pay them yesterday? Did you plan to pay it?

So since we agreed you would pay yourself, what is your plan on how to spend that money? What ever is not planned for, should not get paid for, except it is a real emergency.

The spirit of December is all about giving. And that is great! Please give but give within reason. You do not want to give 100% of what you have earned, meeting several other people’s wants and needs, as I like to believe you also have your wants and needs and you ought to attend to them!

The spirit of giving can also ‘move us’ to buy all sorts of gifts and other items for our families and friends. Please note, the idea is not to stop you from giving, it is to prepare you to give. A gift prepared for, can often be, a better gift given. If you plan to take your spouse on a romantic weekend get-away, paying much earlier can give you more value for your money. Or calling the Hotel early on, could give you the opportunity to negotiate a discount and get other features to your package. This month of December, we will go about our business and see all the flashy items on offer, encouraging you to depart with your hard earned cash for things you might not really need any longer in January 2017.

Let me make one thing clear. If you have done right by your family January to November, December is not the time you now need to ‘over-do’, ONLY to get in trouble in January and be broke!

Many of us are aware of the dry January syndrome. Why does this happen?
We are home for a longer period if our companies go on a holiday, some extend the holidays till end of January or February. We have our children home, maybe some family and friends staying over, and possibly some away who need our support. And these all come at a cost.

Spending money is not the problem for many of us, is it not just to open your wallet and pay? EASY.

It is how NOT to spend, that is the bigger issue. To see nice things and walk away. To be told about a SALE and walk away. To even be ‘harassed’ to buy and still walk away. You know what I mean.

Here are three tips to help you prevent that.

1. Identify NOW, how you will be able to afford or where the money for January and February living expenses will come from. That is, how much will you need in January and maybe even February to run your household? Take note of the nature of your business, as some businesses do not start operation till late after the holidays, while others open but do not make significant sales due to low demand.

2. Identify if the funds for January will be available on time and in full. If not, make a plan NOW, on how you will live during that period and stick to the plan. Plan for the income you just received (November) and plan now for the income you will receive in December now. We would usually not do this in other months but December is special and needs to be treated as such.

Decide what needs to happen in December and January and put a cost to it. Then prioritize and identify what does not need to happen at all or can be moved to another month.

When you see what December income needs to do in January 2017, it might help make you less likely to spend more than you need to or/and prevent you from borrowing to do things you should not do this December.

3. Plan for any windfall, any bonus as soon as it arrives. Ideally, I would encourage us to plan before it arrives but a bonus or windfall might not come at the time you expect it, or in the amount you expect it, or it might not come at all! To plan on something that might not happen could set you back. Apply caution here.

Sir Winston Churchill, is credited with the saying: “Those who fail to learn from the past are doomed to repeat it.”

Do not join the statistics.

Welcome to December 2016!

 

Tolu Dima-Okojie