Tuesday, May 22, 2012

On Saving and Spending...

Yesterday, I discovered the following quote by Warren Buffet:

"Do not save what is left after spending, but spend what is left after saving."

And then this morning, in a totally unrelated search - I discovered the following quote, also by Warren Buffet:

"People invariably do the very opposite of what is best for their personal wealth creation."

It is well known that expenses always rise to meet income, i.e. the more you earn, the more you tend to spend. Hence, the practice of saving what is left after spending will inevitably lead to fewer and fewer savings... :)

On the other hand, saving before spending ensures that earlier-set targets are met, conscious choices are made about spending, and more value is demanded per Naira spent.

As we approach a month end (with the attendant salary disbursement), remember to take out your savings first (after your tithe of course) - and to make sure your savings are safe from you. You may read my earlier financial article about escrow accounts here.

To your financial success!

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