When we talk about financial management, the first thing that comes to our mind is how to manage our money well. The reason why we need to improve our finances is to avoid financial stress or to achieve our material goals. When we are financially stable, we have less financial stress. When we are able to achieve our material goals, e.g. buying car, buying our house, sending our kids to university, we will feel fulfilled. So, in this article, let's discuss what are the 3 things that I will spend my money on to improve my finances.
First item will be education. When we are not able to achieve what we want, there is a knowledge gap, i.e. we are lacking in certain skills or knowledge. If we want to earn well, we need to provide value. We sell our skills to get paid. If we are lack of skills, we cannot earn well.
For example, a music teacher can only earn well when he / she is expert in music and able to conduct effective music lessons. If he / she does not have the musical skill, he / she will not be able to get students. Same to financial management skill, the faster way to gain skills and knowledge is to read more or acquire knowledge from paid courses. When we are reading books or attending courses, we are learning the effective methods and ways from experienced people. From the books or courses, we understand what others have done, their mistakes and successes. We can save our time testing various strategies using our own lifetime. We can avoid the mistakes done by others too.
Second is on assets. Robert Kiyosaki defines assets as things that can provide income. When one spends more on assets, his / her income will increase as well. When the money is prioritized to be spent on assets, his / her spending on liabilities or expenses will be reduced. Hence, never be stingy on investments assets.
Third is on advice from professional such as accountants, lawyers or business consultants. Have you ever wondered where can you spent the most monies on? It will be lawsuits and taxes. If you want to have more monies, you need to be careful on the legal terms and taxation. Most of the undertakings have connections with contract. If we are not careful on the legal terms, it will cause us financial disaster. Understanding the taxation system will enable you to learn how to get the most tax benefits. Every year, the tax relief for individuals and companies is slightly different. For example, there are more financial incentives and assistance for companies during the COVID-19 period such as digital marketing RM 5,000 grant, loan moratorium, etc. Hence, consultancy fees on taxation, business and legal matters cannot be avoided. Saving such fees might make us lose even more monies in the future.
Learn to spend more on the right things, you shall see your finances improved over time.
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