Have you ever wondered why you keep complaining that your salary does not last you through the month? Have you ever asked yourself the reason why? Well, I think I know just what is happening and that is you are living beyond your means.
According to the English dictionary, means are resources or riches. In this context means is your basic income or salary, it could be on monthly basis, weekly or daily.
Everyone wants a comfortable life, where they get all they want as at when due. However life don’t always give you what you want. In order not to live beyond your means, you need to cut your expenditure to your purse. Moreso, there are some people, who does not know they are living beyond their means. The following tips will help to identify whether or not you are.
1. NO SAVINGS ACCOUNT
Saving refers to keeping your spare money for later use. Before you can save it means you have sort out all your expenses for the month and you have the leftover to save. However if you find yourself in the position of not having enough leftover to save, it means you are living beyond your means. If you can break up the habit of too much spending you’ll have enough cash to save.
2. ALWAYS BORROWING MONEY
Some people cannot do without borrowing money, then people will be wondering whether or not they are working. Even some office workers always borrow money from their colleagues and financial institutions. If you find yourself always borrowing money, you need to cut your expenses.
3. UNABLE TO PAY YOUR BILLS ON TIME
If you find it difficult to pay up your bills like house rent, electricity, water among others, they you are living above your means. Examining and adjusting your spending habits can solve this problem.
4. TRYING TO LIVE UP TO FRIENDS STANDARD
If you are someone, who keep a lot of rich friends, who are earning more than you do. You need not to keep up with them because you mighy find yourself in trouble. If you can afford the things they buy, you can go for it but if not stay away from their extravagant lifestly and keep it simple.
5. HOUSING EXPENSE
Housing ratio refers to the percentage of your income spent on your rent or mortgage. In a perfect world, your housing ratio should be less than 28% of your income. To compute your ratio, divide your monthly housing payment by your monthly income. If the ratio is higher than 28%, you’re living beyond your means.
If you discover you fall in one or two of these categories, you need to have a budget today. Ensure you cut your expenditure according to your income.