Get more out of life the S.I.M.P.L.E way.
Rather than being the order in which to align your life, the acronym S.I.M.P.L.E represents six aspects of balanced living when each area is positively nurtured.
Yes, balanced living is possible even considering how the world order radically changed during the course of this year 2020.
Save at least 10% of all your earnings to a dedicated account.
No matter how little your income may seem to you, the percentage set aside soon adds up as you frequently put some money aside.
Invest your savings in a financial instrument with a return high enough for your money to grow. The instrument could be a savings account at a bank or at a building society.
Or it could be an Individual Savings account (ISA), an account that works like a regular savings account, except you don’t pay any income or capital gains tax on it if you’re in the UK.
Your country’s terms and conditions around such products may vary, so take the time to determine what will work best for your circumstances.
Yet another alternative you could explore is stocks and bonds in line with your age according to the well-known asset allocation table. This alludes to any age being an opportune time to get started with investing. It’s never too late. Start now, whatever age you are.
Make systematic investments and keep an eye on the investments to ensure you’re on track as planned.
Be aware of your strengths and weaknesses so that you know what you can or cannot competently administer on your own.
Depending on the complexity of your investments you may need to consult a professional body or person conversant with your investments. It’s usually worth paying for this outsourced service if your returns are markedly increased by the service and losses are appreciably minimized.
As a point of reference, some financial advisors suggest their clients start to invest only after getting out of debt and after having saved at least 3–6 months of worth for expenses in an emergency fund. Your own situation will determine what’s best for you.
Make time for your spiritual wellbeing.
This comes from having a meaningful relationship with the superior being your faith is invested in such as God.
Having authentic connections with your friends and family must be a priority. Give value to the people you meet in all situations. It’s crucial that you show your appreciation for every human you interact with socially or professionally. Fortunately this will consequently boost your self esteem too.
“However many people you know now, you will always need to know more. You want to connect with as many people as possible to increase your chances of meeting the right people who will change your personal and professional life.” Rabbi Daniel Lapin
Prepare for the worst by having an emergency fund in place.
The amount in this fund will be determined by your lifestyle. For example, if you are completely dependent on your car for the work you do, the emergency fund should have enough in it to cope with unexpected car repairs. Maintenance costs such as a bi-annual service for the car should be covered by another fund, not the emergency fund because maintenance is an expected expense.
Live within your means.
Despite it being obvious and simple arithmetic, this is challenging for many people because there’s always something tempting to buy that is often not a necessity but merely something ‘nice to have’.
To stay on top of your finances, the simple arithmetic is ;
always spend LESS THAN your earnings
Any spending above your earnings can wreak havoc because it could trigger the slippery slope of debt.
It’s recommended by some debt advisors that after having an accurate record of income and outgoings, future earnings must only be spent in line with a pre-planned budget.
For instance, if the expected earning is $1,500 and the known expected outgoings are $1,000, then every dollar of the remaining $500 must be budgeted and accounted for.
This is a form of zero based budgeting that helps with living within one’s means.
Eliminate debt as a priority in managing your finances.
I first incurred debt by not fully paying back the amount I had used on a credit card every month and instead only paid off the absolute minimum permitted.
There came a time when my minimum payments barely covered the interest charged by the card company. It started to resemble treading water, without a clear way out. There was a negligible reduction in overall debt while my stress levels soared as I took on extra work to earn more.
Fortunately, I came across a knowledgeable debt advisor who showed me how to systematically reduce debt using either of the two main methods called the avalanche or snowball method.
Whether you choose the avalanche or snowball method to get rid of debt will be influenced by the type and amount of debt you have and your income and ongoing expenses.
Your personality also comes into play here. Are you motivated by seeing a larger positive figure on your bank balance or does the thought of one less debt to pay appeal more to you?
Debt advisers frequently state that no matter how large a personal debt is, there are legitimate ways to reduce or settle it. Some ways take a longer time than others to get through the debt and some may be emotionally difficult to deal with. Yet, there is always a way.
What’s your experience of any of the above six fundamentals of living a balanced life?
