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Who is paying for your holiday?

Who is paying for your holiday?

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Author of Practical Steps to Financial Independence and business & finance coach, Mr Usiere Uko, writes about how to make money from your phone

The holiday season is here again. The roads are freer as schools have closed for the session and some folks are leaving town for vacation. The resilience of the Nigerian spirit is on full display at our airports as departure halls are jam-packed by travellers year after year. Flights are still full and you would have no idea at the airport that there was a recession in town.

We all need a break to get away and recharge our batteries. For that rest to be sustainable, you need financial peace when you return from vacation. Many have gotten away physically while creating financial burdens for themselves, financial booby traps that can explode in their faces if something happens to their primary source of income.

Going on holiday is not a problem. Who is paying for it is the issue? Are you funding it from your salary or profit from investments? Which one is a more sustainable model?

Running on batteries

I remember some years ago leaving my children in the car with my brother-in-law for about 20 minutes. The children started to feel warm and my brother-in-law got this brilliant idea to turn on the ignition and switch on the car airconditioner without starting the engine. When I got back, I met the windows rolled up and the car AC on.

Your guess is good as mine. My battery ran down. I had to borrow a battery to start my car. While I was away, everything seemed fine to my brother-in-law. The car was cool and the music was on. Everyone was having a swell time. He did not know that he was running down the battery and leaving us virtually stranded.

That is how some of us run our finances. We are running on battery. Our employer or business keeps charging the battery and we think everything is cool. We keep forgetting that the charger is not ours. The owner can take it away at any time (employer or marketplace). It is when the charger is removed that we realise that depending on others in the information age is an obsolete model.

Practice delayed gratification

While going on vacation is important for our health and wellbeing, we need to strike a balance between our financial goals and future. By financing your liabilities (like going on vacation) through cash flow generated by your assets, your primary income is available for investing to generate even greater cash flow in the future. If your assets cannot pay for it, simply wait and wish your neighbours travelling a safe trip.

Practise delayed gratification. When you are cooking, you don’t open the pot to dish half-cooked food because you cannot wait. You simply wait until it is cooked. If you eat half-cooked food, you pay the price for your impatience in the toilet. Waiting for the right time is the name of the game. To every thing, there is a season, and a time to every purpose under the heaven, according to the good book.

By building a solid financial foundation today, we empower ourselves to live life on our own terms, no matter what happens to our source of primary income tomorrow. This means we can live the life we desire tomorrow on a sustainable basis. Few things are worse than becoming an ex-big man (ex-millionaire, ex-landlord, etc). It is better to start small, grow big than start big, and become small.

Many retirees also retire from vacations. They simply cannot afford it anymore. They will tell you, ‘you know I am a retiree’. This is another way of saying they did not build enough income, during their working years, to sustain their lifestyle. Their lives were wrapped around their salaries. The moment their salaries stopped and they switched to pensions; they had to drop their standard of living drastically. The only reason others should know you are retired (if you believe in stopping work) is when they see you around more often, rather than when it becomes obvious that your standard of living is dropping.

Play the long game

Having a long-term view of things helps create the right context and maintain the right focus. It is good to know where you are going as you go along. What is right for others may not be right for you this season. You don’t have to spend the money simply because it is there. If your definition of afford is based on what your salary can cover, you have a flawed financial paradigm.

Your salary will surely end, whether you like it or not. After putting in 35 years of service or attainment of the age of 60, those you work for can lay you off or force to retire. Other unplanned events can end your employment before the projected retirement age. If you live to be 95, you still have another 35 years waiting for you after retirement.

If you eat good food and have regular exercise, you will be agile well into old age. What are you going to do with the next 35 years? Are you going to live from hand to mouth? If you brought up your children to earn to spend, they may not be able to support you in spite of their good intentions. Some still send SoS (Save our Soul) home after they have married and had children.

Beyond the razzmatazz of the present, a future awaits. It is when you play the long game that you see the need to take time out to plan that future and work towards it. That may involve making some sacrifices today in order to actualise that future.  If you have no clue what that future looks like, you will give in to current impulses and do what others are doing when you cannot truly afford it.

If you are running on battery without your own charger, you are wearing borrowed robes. Cut your coat according to your cloth and lose some weight if the coat does not fit.

 For questions or comments email [email protected]; to order the book PSFFI, call or SMS to 0808 275 0980. You visit Follow me on twitter @usiere

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