(Excerpt taken from Money Radiance)
By Jon Kho
Consider this situation: Your employer or your business has given you a good chunk of money for you to live by for the next couple of days. What are you supposed to do with it? Here are some tips on handling money and paying off those debts, as demonstrated in the 4 Ss:
1. Set Aside Wisely
Have a plan. If you are an employee, you would know how much salary you receive every month. Create a draft on your journal the priorities of your budget allocation. After jotting down the things you think are your priorities, look at the list again. Are the items on your list the absolute essentials for your household’s needs? Will something happen if you fail to allocate a lot of money in a particular area? If not, take it out of list first and label it as nonessential for now.
2. Spend Wisely
Make sure to follow what you have placed on your budget journal. Make sure that you allocate the right amount of money for each category and have only some few extra allocations for the unknown. It is time for you to take charge and not let the debt be the one in charge of you. Remember to limit your spending to essentials only, such as food, shelter, and communication.
3. Save Wisely
Part of the journal is actually saving a little for your future as well. The more you can save, the better off you will be in the future. When I talk about saving, I do not mean putting money in the bank. I mean finding something out there where your money can grow for you, letting your money work for you.
4. Splurge Wisely
After doing all these things, you should have a lot of money saved up already, leading you to the most exciting part, which is enjoying the fruit of your labor! Remember, this part can only be true if you have done all the above-mentioned first. And it will take time before you can splurge.
The 4 Ss
Money has to be available first before we can use debt as a leverage to spread ourselves well. This is another means of using other people’s money. Debt is like a double-edged sword which we can use for our benefit but which at the same time can cut us if we are not careful in its use.