How to Build an Effective Financial System that will Impact Your Life

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…Like our bodies that need systems to function properly, our personal finances should also have a
system in place to maintain financial wellness….

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[This is a guest post from my friend Divina Joy Ayungo.]
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So you’ve probably heard of this before. The real savings formula, in order to save effectively is to “pay yourself first”. (Robert Kiyosaki)

Income – Savings = Expenses

Even as an experienced accountant I sometimes forget this. I can budget, manage cash flow and analyze the company’s financial standing but I often fail in my personal finances. Well, maybe it’s because I have accountability to the owners and the management of the company. But on my personal finances, I have accountability only to myself. So I become lax.

Like our bodies that need systems to function properly, our personal finances should also have a system in place to maintain financial wellness.

We do not need to tell our hearts to pump, but it pumps on its own. We do not tell our lungs to breath but it breaths on its own. We do not have to tell our stomachs to digest our food but it digests on its own.

That’s similar to our financial life. We need a system. The only difference is we should tell ourselves to save first. We have to have the conscious effort to save. We have to follow the system purposely, patiently and perseveringly (like every time you receive your income or salary).

Income – Savings = Expenses

I just have to say it again because that’s the system we need to follow. And it’s my hope that maybe, just maybe, when I repeat it, it enters my subconscious and yours. When it does, it may become our habit. When it becomes our habit, it becomes less difficult for us to save.

Let me tell you one story.

When I was three years old, my mother found me lying in bed after playing the whole day. I did not respond to their call. I was not moving. I was almost dead. This troubled my parents so they brought me to the hospital. Later that day, the doctor informed my parents that I had Cerebral Malaria.

Cerebral Malaria is also called the Malaria of the Brain. It’s not an acceptable term for doctors but to understand the illness better, people coined that term. It’s called as such because it affects the brain primarily. If not treated immediately, it can assure death.

The doctor told my parents that I needed to take a single dose of a medicine that was quite expensive. Immediately, my mother went to the bank to withdraw. At that time, there were no ATMs (Automatic Teller Machines). Furthermore, banks close at 3 in the afternoon.

It was almost 3 so my mother hurried to the bank. But even if she ran fast, she arrived at the bank past 3. The security guard did not allow her to enter. Mama pleaded while carrying me in her arms.

“Please I need money to buy medicine for my child.”

The security guard took pity and allowed her to enter. “Only this time, he said.”

Mama thanked the security guard and she proceeded to withdraw the money needed to buy my medicine.

Like a telenovela, isn’t it? To cut the long story short, I was cured, alive and kicking – all because my mother followed the system to save.

Every time she receives Dad’s income (she’s a housewife by the way), she sets aside a portion for her savings first, and then she would spend the rest for the household.

Mama’s savings made a big impact on my life and, who knows, your life too. I’m zealous about savings, financial literacy and financial wellness because I experienced the power of savings first-hand.

Your story may be different from mine. But I know for sure that we have different reasons to save and I believe that your savings can make a big difference to your life and the life of your loved ones.

Build and implement the system. Do not tire.

You will reap the rewards in time.

– Divina Joy Ayungo

P.S. That story is an excerpt from the book I have written about How Savings Saved My Life. You can get your free copy here.


Featured image courtesy of Stuart Miles / FreeDigitalPhotos.net

There you have it. Start building an effective financial system today.

Live your life, young mind!

Chris Dao-anis

P.S. Grab your free copy of Divine’s book How Savings Saved My Life now here.

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