Ep 5-Money Mindset Makeover

The episode is about personal finances for young adults. The speaker discusses financial pitfalls such as overspending and impulse buying, and emphasizes the importance of realizing these pitfalls and finding ways to avoid them. Budgeting and money management are crucial, as well as tracking expenses and using apps to help. The speaker also talks about the importance of savings and investments, different types of savings, and setting financial goals. Having a side hustle and seeking financial advice are also recommended. The speaker concludes by emphasizing the importance of financial literacy and the need to consider it as a basic skill. Hi guys, welcome to this week's episode of Totally Random Things. The episode will be on personal finances for young adults. Yes, because I'm a young adult and I cannot relate to those people from Gen X, Y, or those of our generations. Or those who are, yeah, of course me from those of our generations and years ago, way older than us. So let's start off with like the financial pitfalls. As a young adult, my God, why is overspending and impulse buying a thing that you can't avoid? You know, not like you can try so hard, you can try to be so hard on yourself, but you find yourself, you know, impulse buying or just overspending. But I feel like the step of realizing that this is actually a pitfall and I should be avoiding this is like a good way, like it's a good start, yeah? Because now from there you try and come up with ways of how can I avoid this? Maybe these are tips that are going to help you like on how to avoid this. You can try sticking to a budget. That is why it's really important to have a budget. So you try to stick to your budget. If you're going for shopping, make sure you write a list and stick to that list. If you have to leave your cards and your phone at home and carry enough cash for just what you're going to get, if that's how you're going to avoid impulse buying and overspending, just do what works for you. Because this is something that can finish your money really bad. The whole idea is just to spend the money, but it doesn't make sense if you have money today, you go overspend it. Tomorrow you have expenses, like let's say just an emergency expense has popped and you overspend your money. You know, it doesn't, it really does not. Hai fai hivo, you know, stupid. But anyway, I also feel like we wait till too late for us to start seeking financial aid. See, someone waits until they have the money or they've started earning so that's when you try and allow like, you either find yourself you're getting this money and you don't know what to do with it. Yes, you have bills, you're paying them because you're supposed to be paying them, but you really don't understand the other things you can do with your money and all that. So it's good to really like seek to understand what can I do with my money, what is the whole idea in the whole financial literacy aspect. Yeah. So let's start off with budget and money management. Budgeting is really crucial, especially in helping you have control of your finances. Because coming up with a budget, you know, I can afford this because I have this amount of money, I can't afford this, I can't do this, this, this time around because my budget doesn't allow me. Knowing that you can do certain things and you cannot do certain things because you know this, this is the amount of money I have, this, this is what my budget looks like, you get me? It's really crucial and it's also good to have something that helps you keep track of your expenses and also maybe your savings and all that. You track what you do with your money, you see what did I do, there was this expense, this has popped up one, two, so many times, I can do better next month or next week and not, maybe this is really not as necessary. And then we have apps that can help you do that, like help you keep track of your expenses. So if you're going to get yourself at a point where you're asking yourself, oopsie, I had this amount of money last weekend, now I'm going to add zero and you don't get where the money went to, I don't think that is really good. So you should try whatever works for you, if it's getting that app so that you know, you see, you can follow, you can check any time, you can keep track of, oh, this is the amount of money coming in, this is the amount of money going out. Especially if you're running a business and you just not, or in as much as maybe you're employed and have that one, like monthly income, you still have other sources of income, it's good to track and see, this is the much that comes in weekly or bi-weekly or you know, monthly and this is the amount that goes out. It really helps you then in coming up with a realistic budget for yourself. The other thing is about savings and investment. Okay, I know, so the minute you be talking to someone, you're like, ah, so do you invest, do you save? And they're like, um, it just gives you some funny answer. But I feel like the fact that you just told you're supposed to save and that's it, that doesn't help much because you find someone, I'm going to get my money today, let's say I'm going to get my several days, I'm going to save this amount and then tomorrow my rent is due, what do I end up doing? I take all the money I saved and pay, but I tell myself that I save, but that's, like, what is that? Like, sitting down and looking at it, it's not saving, that's not what's saving. So like, knowing that there's different ways of saving, you can save on different like platforms, knowing where can I get more money, where can I get an interest for saving, where like, can I get a higher interest if I save on this platform than this other one, getting such information really helps, yeah? Realising that the different kind of savings are like, you know, having an emergency fund because, you know, something could come up, you could get laid off from work at any point and having that emergency fund really gives you some peace of mind and it also helps you not to continue with the same thing, but maybe it's a toxic workplace just because you're afraid if today I take the bold step of leaving because this place is toxic for me, what's going to happen? Will I get another job? Will I have a continuous flow of income and all those kind of things? Yeah, so also understanding that you could be saving for maybe a thing you need, so you're just saving for an item that you really need, in need of, is also like another way of saving. Really like understanding what is saving, how can I save, where can I save? I feel like those are aspects we need to be cognisant of and just not, you know, do things for the sake of it because there ain't no way you're getting your money and just taking it to saving and you're supposed to take care of your expenses, you know, pay rent, buy your household items, nini nini, all those things, so you end up taking it out to do this, so you first do this and then out of there. Someone who tells you that you don't first save, you first take care of the bills and everything you need taken care of and then from there you can take the amount you need to save. Because again, what's the point of, you have a certain amount of money, you're saving let's say 80%, you're left with 20%, 20% can barely take care of your expenses, so you end up not, you know, not, those are not like wise financial decisions we've made over there. Also, the other thing people tend to do with their finances is you save in a platform where, let's say it's your emergency fund, an emergency fund is something like when an emergency pops up, when you go save somewhere, like on a platform where you can access your money maybe up to a certain period of time or like, you know, you just check, there are certain rules on these platforms. If it's an emergency fund, I need to be able to access it at any time because as the word goes, it's an emergency fund, so you don't know when an emergency is going to, you know, pop up. So that's why you need to be aware, like, save up because of one, two, three, you may make certain considerations, you know, all those things. The other thing is you can choose to automate your bills or your savings. You see the way your money comes into your account and then like you have automated certain things such that a certain amount is transferred to your savings account, a certain amount is transferred to maybe a certain bill and all that. I feel like that really, really helps such that you don't find yourself maybe you've gotten your money today, you're going out today and you find yourself overspending on other things yet you've not already taken care of your bills. So as soon as the money comes in, certain things are like taken care of automatically. That can also be a great way to help you with, you know, your finances. Let's talk about the other thing which happens to be financial pitfalls. I don't know why I feel like I spoke about financial pitfalls at the beginning of this episode. Oh my God. If that's the case, we're going to do a really big... Let's talk about the other thing which is financial goal setting. You know, I don't know, maybe we feel like we're too young to be saving for like a house or... But again, in as much as you have the dream of one day owning a house, I don't see why you shouldn't make financial goals. You see, in as much as you have material goals, like I want to have this car, I want to have this house, I want to have this, this, this and that, at a certain time, let's also put like financial goals on the same because you know you're going to achieve these goals if finances are not involved. It's really, really crucial for you to have financial goals as well. Also, there's this thing about side hustling, you know, which is... I don't even know what to say about it. It's really good to have a side hustle and I'm saying this because especially for people who are like, okay, it's just good to have another source of income other than... Because when you do, we always say plan A could always go wrong, you have a plan B, yeah? Having a backup plan even gives you confidence because you won't operate from the point of fear where you're scared, what if my business collapses, what if... You know, a lot of things could happen, a lot of things could go sideways but having a plan B really helps and at least we're people who like... We've found ourselves on earth at a very good time where the internet is there so you can have an online something going on where you generate money from. I feel like there's so many different options for us. It doesn't have to be like, you know, at A you have to have a physical place where you have a business. No, you can do a lot of things. You can do transcribing, you can do academic writing, you can just learn a skill and be a freelancer online. You can just do anything. You can also maybe invest in learning a skill and then offer services on that same... I feel like we have so many opportunities we can explore and that's the great thing of not being born in Zanzibar, Kitambo. So the other thing is about investments. Okay, I know, maybe at least we feel like making an investment is so demanding, which is true, but you also have other options which are so affordable to invest in. You realise that investing in learning a skill, let's say, you will have that skill with you. So it's cheap because you can do it maybe virtually, learn the skill and you're good to go. You can offer services with this skill and generate money from that. You can invest in livestock, shares. I feel like these things, they don't require you to have so much capital for you to invest in them. So you can, as a young person, maybe you have limited finances and you feel like it's a hindrance for you to make investments, but you can look for those options, you know, mutual funds, things that are not so demanding, things that don't require large sums of money, things that are like very, very, very affordable. Yeah. And so generally, I just feel like it's really good to seek financial advice. It doesn't matter whether you seek from, okay, yeah, it would really be advisable if you seek it from an expert, but it's also good to be curious and ask questions whenever you can and know certain things regarding finances and all that. It really helps a lot. Yeah. And I also feel like, you see the way you talk about in school, you talk about hygiene, you talk about those things that people feel are basic. Financial literacy should also be termed as a basic thing, like something you should know because we depend, like we depend largely on finances for us to survive as human beings. And that will be it for this episode. Thank you for tuning in. See you on the next one. Thank you.