There is a friend of mine who earns less than $200 a month, and he also saves some of his money, which is incredible. He is one of those people I admire because most times I used to think of how he was able to save despite his low income. A few days ago he messaged me and he complained about how he struggled with his savings recently and how difficult it is to save money these days. My first question is what changed because you are not new to this.
As we continue to have a conversation, I realize that he got another job and for the past two months he’s been earning a lot of money, which brings me some kind of concern. He is making more money than he used to he shouldn’t struggle with his savings. He was also surprised and when I asked him, he said he doesn’t buy anything serious, and more reason why he messaged me. He doesn’t know what is wrong with his finances so I told my friend that we should begin with numbers and when we calculate all his expenses I realize that he’s actually his own problem.
Stupid stuff
My friend already started going a gym and every morning he buy fruit salad, which is around 2000 naira, and tigernuts smoothie which is around 2000 naira. So at the gym apart from his gym subscription he spent nothing less than a hundred dollars and his gym subscription is around $20. When he goes to work he also buys some things to work and all this spending he doesn’t do it before, but just because he got a raise in his salary, my friend got comfortable.
The thing is, he doesn’t spend all his money on something reasonable and he’s not investing. He’s been buying stupid stuff. A lot of things that are designed to make a life look comfortable and things we spend extra money on are things we really can do without. Most people always have this problem They spend a lot of their money on stupid stuff when they start making money.
Stupid stuff can be anything, can be you buying 50 50-pound coffee or 50 50-pound sandwich on your way to work. You can be buying a smoothie or buying chocolate in the gym, or buying 2 2-pound water bottles in school. Sometimes I have this problem of refilling my water bottle spending two or 3 pounds on water and before you know it you don’t have any money again, which is crazy.
Most people spend 30 to 40% of their income on stupid stuff that is not necessary and if you put this 30 to 20% in a good investment strategy, you might as well build something for yourself in the long run. Just like my friend, people also start increasing  expenses, which is why no matter money they make they still find it difficult to save money.
Thanks for your time.