…what to do with your last two salaries
It would be safe to say most Namibians never seem to learn. That every January is never their best month. It is a fact that after a long and pocket draining festive season, Namibians have normalized being broke in the first month of the year and somehow only recover with their February salaries.
Well, it’s that time of the year again, probably a bit early, but it would not hurt to touch on the topic already now, because maybe it will assist us in planning better. The festive season is known for time spent with family, huge purchases, and because of many logic-deprived spending decisions, the consequences are that of a very long and dry Janu-worry month.
So what do you do when you have two more pay days to celebrate, taking into consideration that your past festive seasons have not been too kind to you in the first month of the year? While it might sound overly dramatic, especially in the black communities, a budget with the right discipline and other efforts of investments would do.
First National Bank’s Investment Specialist Simon Lebang places the need to have a proper budget at hand as a top priority. This will guide you through your festive season and still be balling on January bills with no worries.
Budget, Budget, and Budget
It is around this time that people will be getting their bonuses, money that in many cases is budgeted for nothing but fun. Instead of making a smart decision, especially in a time of recession, we think a bonus is for fun only.
“You will need a proper budget while it is still early such that you know your total income and expenses. It is one of the methods known to everyone but only works when executed with the right discipline, said Lebang.
As the name suggests, a budget based off your income proactively assigns a role for each cent you make. It is a great way to manage your money, and it’s also the best way to make sure you’re not spending more than you make
So, if you take home N$2000 a month, set a budget that allocates N$1,000 to your needs, N$600 to your wants, and N$400 to your savings. You might also want to think of the cost of taxi for January, food for your flat and parental responsibility for the children. It will be a ‘Back to School’ thing and if government goes through with re-implementing school fees, then put the amounts together.
“A budget will serve the purpose of guiding you on your expenses ahead, how much you have at hand and how much you can squander.”
This advice serves best at this point seeing that the November salary has not yet been touched and thoughts on what to do with the bonus have not yet been executed. Besides the obvious, it is smarter to put away some money that will take you through the following month says Lebang.
Don’t buy everything you see!
“People spend crazy in December. They would buy everything they like or see other people buying just because they have the money. So we advise people to stash away some funds for January. You could invest the money, depending on where you bank, so that it could do you good after festive season,” said Lebang.
Big purchases are amongst the causes why people often shy away from their monetary responsibilities after the festive season. If you still have a salary before the season kicks off, Lebang as well advises you sit and interrogate your expenses. “Regardless of what you want, you need to spend within your means.”
“Another possible option would be applying for a credit card. Instead of spending every dollar you have, it gives you the flexibility but you still need to swipe responsibly.”
Januworry is not so kind to forgiving your KeDecember mistakes and chances are that there will be no one to give you the financial shoulder, when you have to fill your fridge with the basics. Your November salary is supposed to be for December and that of December for January. If by any chance you do not have a plan that splits your money into that order, you will be singing the same song many Namibians have normalized.
Before you take that trip that has not been budgeted for in detail or bless the entire friend and family circle with gifts that they are yet to request, look at what you have, think and act accordingly before you blow your horn.
So before you get your last salary, it is best to start thinking how the November salary can pull some strings in times when everyone wants to look cool. The crux of the matter boils down to the need to draw out a smart practical plan that will not bring back throw-back moments of the year that was.
So think twice before you squander, budget or invest – the heavy winds of January are coming again and how you take it depends on the last two salaries you will get for the year.