Embarking on a trip to financial independence

 One skill that we should all master in life is “How to manage our finances”. This is not an easy skill to learn, however, it is necessary. Although I did make some mistakes in regards to money, there is always a room for self-improvement and self-advancement. And, if this Covid19 pandemic taught me anything that is how to be careful with money.

Learning how to spend, save, invest and make money is invaluable and helps you to live debt and stress-free life. I don’t suggest that you should be tightwad, however, choose your battles smart. Although I still have a long way to go, below I will share my experience on what I do to cut on my expenses and increase my savings.

Less is more. Don’t be a spend-thrifter. Don’t waste your money and time on buying the things you don’t need or to impress people you don’t like. Nobody needs twenty pairs of shoes or a full wardrobe of clothes they don’t even wear. Nobody needs tons of pairs of sunglasses, watches and bags. Nobody needs a big expensive car if they can’t afford to maintain it. Don’t waste your hard-earned money in expensive restaurants, cinemas, clubs or luxury resorts. If you can’t control yourself try to figure out what triggers you to buy things you don’t need and what you can do to stop this. Buying things would bring you short term pleasure, but bigger pleasure would come from knowing that your bank account is getting bolder each month. To summarize, think before you spend.

Reconcile your credit card. When I just moved to Dubai I got my first credit card. My salary didn’t meet my expectations so I didn’t have enough money to pay the rent check. As I didn’t know any other way how to get money fast I opted for credit card cash advance with 18 instalments (literally the worst thing you can do with a credit card). Once you enter this vicious circle your debts just keep accumulating and as the time goes by it gets worst. Soon after, I applied for a second credit card with an even higher limit. As I didn’t have lots of understanding about credit card charges I kept purchasing things through instalments and after 3 months my monthly payment for my credit cards reached half of my salary. About that time my company organized a finance workshop and I was advised to reconcile the card with a personal loan. The idea was to close my credit card with a loan so I can increase my monthly cash-flow and at the same time buy a car. And yes, my financial situation did improve after CC reconciliation.

Track where your money goes. The best way to track your money is through an excel sheet or mobile application. Try to keep consistent for at least 3 months and you will get an idea where your money goes. How much you spend on rent, on utilities, on entertainment, food, debts, gas, etc. Tracking your expenses can help you to decide what expenses you can cut down in your daily life and that money you can add on your saving account instead.

Educate yourself. To be honest I find it very difficult to focus and understand the markets, funds, investments, stocks, ETFs and crypto market. However, I am aware that I need to learn and understand these terms and better sooner than later. If you not sure where to start, check if you have any friends who are investing money and can give you a head start. After you gather some basic information start reading the books about money, investments and savings, watch youtube videos, follow inspiring people who did it already and spend time educating yourself. Probably, the time you spent on this will pay you off later and you will be glad that you started early.

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hey you!

(Pink Floyd)

Hey you, out there in the cold
Getting lonely, getting old
Can you feel me?
Hey you, standing in the aisles
With itchy feet and fading smiles
Can you feel me?
Hey you, don’t help them to bury the light
Don’t give in without a fightHey you out there on your own
Sitting naked by the phone
Would you touch me?
Hey you with you ear against the wall
Waiting for someone to call out
Would you touch me?
Hey you, would you help me to carry the stone?
Open your heart, I’m coming homeBut it was only fantasy
The wall was too high
As you can see
No matter how he tried
He could not break free
And the worms ate into his brainHey you, out there on the road
Always doing what you’re told
Can you help me?
Hey you, out there beyond the wall
Breaking bottles in the hall
Can you help me?
Hey you, don’t tell me there’s no hope at all
Together we stand, divided we fall!

This song is so powerful and touching. There is always light at the end of the tunnel even though we might not see it. I feel like the song is calling us and talking with us, saying that we should never give up no matter what. Especially today when our lives are changing in so many unprecedented ways.

What is your favorite song from Pink Floyd?