Your Journey To Wealth #1 :Where does your money go?

Your Journey To Wealth #1 :Where does your money go?

Have you ever received money only to find out you’ve run out quicker than you imagined? The next step is often denial. After checking all bags, shelves and surroundings, then comes acceptance.

Now at this point, two things could  happen:
1. Look for the means possible to get more funds(maybe borrowing or touching old savings).
2. Accountability. That’s taking a step back to recount how and what money was spent on. Some people simply can’t remember everything especially when the money was spent insignificantly.

Personally, I dislike the feeling of ‘not knowing’ which brings up to the topic of the day. Budgeting.

A budget isn’t anything new or fancy but it’s a very important financial tool. It’s basically a forecast of your finances over a period of time(I prefer short term so let’s say a month).

Everyone must have had a budget at some point in time either written or in mind. I don’t expect you to have 20 dollars in hand for shopping and then walk into a Prada store. Except for window shopping of course lol. So in this case, that 20 dollars is your budget constraint and you have to stick to it per time.

How do you make a personal budget?

I think making a budget is something that is different for each individual depending on some factors. At the same time, there are things that should be constant in all budgets.

Let’s take a look at a generalised budget breakdown:

Essentials/Needs (45-50%): This is where the important things fall in e.g. feeding, rent, transportation, bills, obligations and others.

Luxury items/ Wants (25-30%): Because everyone needs some extra to be happy in life. These are the ‘nice to have’ e.g. parties, vacations, luxury hair, gifts etc.

Savings & Investment (20%): At least 20% of every income should be set aside as savings and because just saving isn’t enough, accumulated savings should be transitioned into investment(to be discussed later).

Religious Obligations (10%): If you are a tithe paying Christian then at least 10% of your income goes to that as well.

I stated earlier that the budget is different from individual to individual. For example, most students don’t need to pay rent and take care of some certain essentials so their budgets can’t be 45-50% on essentials. Rather, it should be swapped with savings i.e. essentials 20% and savings 45-50% so no need to start living an overly luxurious life when you can save the extra for when you’ll actually need to pay the bills.

Before making your budget.

A budget won’t help when it’s not followed. So to avoid falling out, the following should help:

1. Know your income. Whether you’re getting an allowance or a salary. Know how much is coming in. That’s why I prefer monthly budgets. All expenses for the month should not exceed that value.

2. Don’t focus on transitory incomes. Transitory incomes are just those extras that you didn’t plan for. Maybe a surprise alert from a friend or relative. And if someone promised to gift you with some money, please don’t draw up your budget based on that(except for your luxury expenses that you can do without if the money does not come through). The same way there are transitory incomes, there are transitory expenses so keep the extra cash for future use. Thank you.

3. Do an expense round check. Simply outline everything you might need to spend on for the month with the cost estimate. Once that’s done, create a scale of preference starting from the essentials not wants and stop where your current allowance lets you without touching your saving percentage(except all your expenses are ‘needs’ which is very unlikely).

4. Take out your savings first. Just do this. Except your needs are heavy and you aren’t doing any luxury for the month. Once again, unlikely. Saving first will make it less of a chore because it’s like the money was never even there( at least for me lol).

5. Lump sum expenses should be spread across different months. Things like school fees, travel, rent or any other big project shouldn’t be paid overnight. Get the estimate and spread it over the 12 months. You can create a separate account for that so you don’t mix it up with your general savings.

6. Ensure you have a fun budget. Don’t go and be saving everything without accounting for some luxury at least. No matter how small depending on your lifestyle. Get yourself something nice.

Sticking to your budget

If you follow the steps above I doubt budgeting will be a chore but I suggest you do a daily or weekly audit (depending on the frequency of your transactions) so that you can always check yourself and correct any overspending in the next weeks.

Tip: You can get a budget app to help you keep track if you don’t like writing down things. I use ‘Spendee’ it’s a really nice app, different colours, charts and all. You can also log in daily expenses and income under different categories e.g. food, transport, groceries, savings, gifts etc. you can add yours.

There’s also a Nigerian one called ‘Reach’ @findreach on Instagram and Twitter and it has been good so far.

You can also try Monefy or Dollarbird.


That’s about it for now. You can add in any suggestion/ contribution here or connect with me on Instagram (@Bee_Abba) for more tips. Hope you learnt something.

See you next time and stick to your budget!



  • Abazie Kachi
    October 3, 2018

    This is a really nice write up, and also very educative. Thanks for this Blessing.

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