How to audit your finances

10 questions you need to keep your finances in check on a monthly basis

People do not decide their futures, they decide their habits and their habits decide their futures. — F.M Alexander

1. Which of the purchases this month were impulsive?

Before this pandemic happened, my girlfriend and I had our biweekly meetup in a mall. After a scrumptious Turkish breakfast, we went window shopping. I didn’t have plans to buy anything. But because there’s always a ‘sale’ at the mall, we found ourselves in a jewellery shop that had a ‘buy 3 for $10’ sign. We immediately started identifying the earings we loved, asking ‘would this look good on me?’ as we filled our little shopping baskets.

2. How many of my purchases this month have long term value?

This question ensures that I’m constantly investing in myself and expanding my knowledge.

The same mindset and skills that got you to where you are now, are not going to get you to where you want to be five years from now. Have a self-improvement budget.

Last month, I paid $300 for an online ‘Launch your blog business’ course that I have been eyeing for the last 2 years. At the time I thought it was expensive, then I remembered a lesson from Steven Silbiger’s book The Jewish Phenomenon which talks about the 7 keys to the enduring wealth of a people. The first key is ‘understand that real wealth is portable; it’s knowledge.’

3. Which 3 things do I want to cut from my budget this month?

You will still end up making terrible financial decisions such as making impulse purchases. Once in a while, it’s okay.

The first mistake is never the one that ruins you. It’s the spiral of repeated mistakes that follows. Missing once is an accident. Missing twice is the start of a new habit. This is the distinguishing feature between winners and losers. Anyone can have a bad performance, a bad workout, a bad day at work. But when successful people fail, they rebound quickly. The breaking of a habit doesn’t matter if the reclaiming of it is fast. — James Clear

One of the costs I wanted to cut back on this year was transaction costs incurred while sending money home or making international transfers. If I invest in something that gives me a 4% return per year and spend 10% on transaction costs then it ceases to be an investment. Keeping track of these transaction costs helped me decide to save and do bulk transfers e.g paying the Chama for the whole year.

4. Of all the items I bought, have any of them gone on sale?

Of course, it hurts to pay for something then see it go on sale the next day.

5. How much did I spend eating out?

Truth is, I don’t enjoy cooking. Being wealthy for me would mean having someone in my life whose job is to worry about what and when I eat. That doesn’t mean I’m a bad cook. My mama taught me a few tricks, I did Home science in high school and I can read and follow a recipe.

6. Did I set a concrete savings/investment goal and did I meet it?

Vague goals produce vague results.

When you know what matters to you, it’s easier to ignore what doesn’t. — Shane Parrish

Sometimes a better investment opportunity will be presented to you, factor in the opportunity cost, make a decision and move.

7. Going forward, what I’m I specifically saving up for?

Oh, I love this one!

8. How much do I need to save every month to meet the goal?

This also eliminates vagueness. It breaks down the goal into small manageable amounts.

9. What is the one tangible way I can increase my income in the next 6 months?

George S. Clason in the book The Richest Man in Babylon lists ‘increase thy ability to earn’ as one of the 7 cures for a lean purse.

This question will inspire you to do more and be more. And will also give you an abundance mentality and optimism for a brighter (or a blinding one I dare say!) future.

10. Did I put money towards something I genuinely care about?

As you work towards getting more sssschmoney, it’s crucial to remind yourself not to forget to be empathetic, to see yourself as part of a larger whole.



Your voice of reason before you blow all your money this weekend!

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