My Drastic Money Habits That Helped Me More Than 5x My Net Worth
My honest break down of the exact steps I took
To be honest, I had my reservations about writing this newsletter.
I’m actually afraid that you’ll be carried away by the title and quickly scroll down to see if I inserted a screenshot of my account balance or investment portfolio.
But just like what I said in my last email: focus on the strategy that will bring in the wealth and not on the figures.
If you’ve not had a chance to read the last email, you can catch up and read it here.
Here are some things you’re expected to learn at the end of this newsletter:
How being self-aware is the secret to solving your money problems
How you can tailor your money habits to work for you
Why paying yourself first before giving your money to anyone else is an act of self-love
My exact money habits and how they worked
But in return my challenge to you is to take a screenshot of the part of this newsletter that you found insightful and tag me @mary_imasuen (on Twitter or Instagram) with the hashtag #RelishAbundance.
Deal?
For those reading my newsletter for the first time, I’m Mary Victoria and I love fintech but one of the highlights of my journey into fintech was when my roommate said this about me:
“Mary is the kind of person who would walk into a bar and say ‘free drinks for everyone!’”
My first reaction was to laugh, but as I mulled her words over I knew she was right. I was spending my money on dumb shit. And no, I didn’t walk into a bar and neither did I buy everyone drinks. What I did was to spend my money on everyone except myself.
And don’t get me wrong. I didn’t say don’t do nice things for people. But always make sure it’s after you’ve paid yourself first.
What does paying yourself look like?
My mom always told me about how she made it a policy to buy herself something as soon as she got her salary from work. It was her way of appreciating herself for the job well done. Or in my mom's words, she wanted to “have a remembrance” of the work she put in or give herself a “consolation" for all her effort.
That was my mom's way of paying herself first.
But for most people, as they receive their salary, they're off to cover some expense (or in my case, spend it on other people).
And I understand. You have responsibilities. But think of it this way:
Who busted their ass off working?
YOU.
Then why not pay yourself something out of your salary or profits from your business that you can put into something that will secure your future financially?
You're the one who earned the money, so why not reward yourself for doing so. I think that's the highest form of self-love.
In the book Rich Dad Poor Dad by Robert Kiyosaki, the concept of paying yourself shows up in 2 forms:
Setting aside money for savings
Setting aside money for investment
The Rich Dad in the book always paid himself first. And he was so diligent in this practice that he paid himself even if there wasn't enough to cover the bills.
And you may call him insane, but he knew that paying himself first would improve his financial future. He played the long game.
Sadly, many of us put ourselves on the bottom of the list.
We pay our bills, spend money on items that we don't need, buy food at eateries, then pay ourselves out of whatever is left of the money (that's if there's anything left).
I did this to a fault. And my net worth was ZERO or some loose change which I knew I'd give away for some absurd reason.
How did we get here?
I couldn't help but reminisce over my past money habits when my friend, Jeremiah Ajayi (or Jerry, as I fondly call him), asked me for some money advice.
For the past couple of weeks we've been having our weekly “mastermind” calls and it was on one of those calls where I spoke about my process.
Jerry shared some of my tips in his newsletter, The Weekly Goodness, where he sends bi-weekly emails with career advice and juicy stories about his experience in different workplaces.
You can subscribe to his newsletter here. His tips are pure gold and he gives the best gists.
Money habits that 5x'ed my net worth
You might find some of my strategies extreme. But they changed my life.
Before I go into my money habits, let me give you some context.
I knew I had a spending problem, so I had to create systems that will make me think that there wasn't enough to give away without making me experience and/or exhibit scarcity.
This was important.
I wanted to teach myself to exercise restraint from a point of abundance and not from the perspective of scarcity.
This is because I knew that if I started to feel that there was a lack of money, I'd act in a way that will attract more lack.
The law of attraction says that you attract more of what you think. So, if I thought lack or scarcity, I'd attract more of that. With a zero net worth, that was something I didn’t want to risk.
I knew I had a spending problem, but instead of feeling bad about it, I used my problem as a clue to guide me on the strategy that would work for me.
With this level of self-awareness I was able to develop the best strategy for me. And if you're a crazy spender like I was, these strategies will help you too.
1. Carry little cash around
I realized that I only spent money that I easily had access to. That means that in order to reduce my spending, I had to reduce my access to cash as much as possible.
So I decided to only carry just enough cash to get me through the day.
I calculated everything from my exact transport fee to and from work, to money for a little snack. I carried food from home so I didn't have the need to buy anything while at work.
My sister and I went to work together, so I handed over my transport fare to her, leaving me with money to only buy snacks on my way home.
Since the only money I had available was my snack money, that made me think of spending that money wisely.
My snack money was N200 and more often than not, I used it to buy bananas. And I made sure I kept some for my sister to eat on our way back home. So whenever I shared bananas with others I made sure it was only from my ration.
That detail is important.
In my mind the N200 wasn't just mine. It was my sister's too. My spending problem was geared towards spending money on people. So, naturally, my mind hinged itself on the next person I should spend my money on.
In my mind, giving away that N200 to someone else, felt like me starving my sister. So if I wanted to help someone, I'd rather save my half of that money and use the other half to get my sister snacks.
My sister had more than enough money to spend on snacks but my mind didn't process that.
So if someone asked me for money, all I could think of was “money was budgeted to the penny".
2. Use only one bank account
I applied the same reasoning above to my bank accounts too.
I had more than one bank account, but there was one account that I formed an attachment to.
In my mind, access to that account meant easy access to all the money in it. But when I kept money in another account, my mind processed that as money I don't have access to, even though that account was mine as well.
So, what I did was to put a good chunk of money in different accounts and specifically labelled such accounts in my head as accounts that can't be broken into.
It might sound strange that although I technically had access to them, labeling them as accounts that must not be broken into made those accounts a no-go area for me.
I made sure that I never got myself a Debit card or find out the USSD codes to withdraw money from those accounts. I didn't bother downloading their apps either.
More often than not, I'd even forget I had anything in those accounts until the day I had to put another chunk or money in them.
This simple exercise helped me limit the amount of money I had access to in my bank.
Before I spent any money in my bank account, I'd count how many days left to the end of the month.
This was to remind myself that the money in the account had to last until the end of the month or I'd be broke (which technically wasn't true but my mind believed it).
So each month turned into the fun game of me trying to out do my last month's balance.
3. Set spending thresholds for your accounts
This was an exercise I did way back in 2017. It started off as a game. The goal was to not spend money beyond a set threshold.
For example, let's say you have N500 in your wallet and it’s your usual custom to spend it all before getting home. You can mentally set a threshold of N100 and try as much as you can to make sure that by the end of the day you have exactly N100 left.
I played this game as a way to prove to myself that I could exercise some level of control over my money.
But trust me, it was hard.
There were days I walked instead of taking a tricycle to my stop or forego snacks. (I know I've mentioned snacks a lot. I'm half-Filipino. 😂)
But it was satisfying to see that I'd make the threshold. I kept at it until I had N1000 extra in my wallet. It was crazy depositing N1000 in the bank but it was the most satisfying victory ever.
I carried this same practice to my bank accounts as well.
Let’s say you have N50,000 in your account. Your threshold could be N10,000 by the end of the month. So the goal is to make sure that by the end of the month, you don't spend beyond that threshold.
Whenever I met that goal, I'd take that money and keep it in another account, then restart the game.
After successfully hitting the goal several times, I increase the threshold. This gave me an additional challenge. But it was fun to see just how I was able to use my money wisely.
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4. Lock up your savings
Taking cue from my need to reduce access to cash, another strategy I employed was to lock my sayings.
For this purpose I used PiggyVest’s Safelock feature.
Safelock gives between 6-13% per annum depending on how long you lock your savings. In return you are given your interest in advance which goes straight into Flex Savings.
In my mind, I also labelled PiggyVest as one of the “accounts that must not be broken”.
What I loved about the Safelock feature was how I made more locking my money away than I did keeping my money in different savings accounts.
Eventually, I moved the money my former savings accounts to PiggyVest to benefit from the higher interest rates.
On PiggyVest you can lock up your money for as long as you want.
I started off locking my money for one month, then 6 months and now I go as far as a year.
The longer you lock away your money, the higher the interest you're given. This not only reduced my spending, it increased my net worth.
5. Autosave
By this time I was really attached to PiggyVest. My friend, Anosi Olumekor, told me about PiggyVest’s autosave feature and I wanted to give it a try.
Anosi made a guest appearance on one of my podcast episodes about PiggyVest titled “A Quick Tour of Saving and Investing with PiggyVest + Review from New & Long-Time Users”.
Through the autosave feature, money is saved automatically into your Piggyback on PiggyVest. All you need to do is to set the date PiggyVest should make the withdrawal and how much they should withdraw from your account.
The great part about it is that if you don't have that amount in your account, PiggyVest will not withdraw any money until the next withdrawal date.
The interest rate on the money kept in the PiggyBank is 8% per annum. So you get to enjoy the returns from the money that was saved.
6. Invest…a lot
At this point I was on a look out for other opportunities where I could keep my money. So the next thing I did was to start investing.
One of the fastest ways to grow your net worth is to invest. Although investing is a lot riskier than saving, the returns are a lot higher.
I'm risk averse so I naturally was on the look out for “safer" investment options.
PiggyVest's Investify feature gives you the opportunity to invest in projects. The projects that piqued my interest were the ones geared towards agriculture. They offered returns between 12% to as high as 36%. depending on the timeframe of the investment.
This was a gamechanger for me.
Through investing on PiggyVest I grew my net worth really quickly.
Then I took my investment game up a notch by adding stocks, crypto, and real estate to my investment portfolio.
To invest in stocks I used Bamboo and I started my investment journey with $20. Although I wasn’t able to buy a complete share of blue chip companies, I was able to buy a fraction of those shares. So I started off with investing in $4 in 5 different companies.
When I first started, I honestly didn’t know what I was doing. So I invested in a growth stocks like Google, Tesla, Spotify, and Etsy. Then I included one dividend stock: Apple. I didn’t have any reason or strategy behind my investments. I wasn’t aware that 4 out of the 5 stocks I bought didn’t give any dividend.
But it was after I received my first dividend from Apple that I took investing in stocks seriously.
Want to know how I invest in the stock market? Comment below to let me know.
Then I started my crypto journey by randomly investing in Bitcoin and Ethereum on Luno just about 2-3 weeks before the infamous “Crypto Ban“. Just when I thought my crypto investment journey was over, I came across Bitnob and started saving my money in bitcoin.
I spoke all about Bitnob and how it works in my podcast titled “A Quick Review of Bitnob (+ Investing in Bitcoin)”
And then I discovered RiseVest. RiseVest allows you to invest in dollar denominated assets. All you need to do is to create a plan, deposit money and RiseVest does all the investing for you.
You can create 3 plans on RiseVest:
The stock plan, where your money is invested in stocks. The estimated annual returns on this plan is 14%.
The real estate plan, where your money is invested in high demand rental properties. The estimated annual returns on this plan is 15%
The fixed income plan, where money is invested in secure, appreciating currency. The estimated annual returns on this plan is 10%
Me being me, I created all 3 plans.
7. Live on only one of your sources of income and save or invest the money from additional sources
According to the American Internal Revenue Service (IRS) the average millionaire has 7 sources of income. And if you start doing some of the things I mentioned in this newsletter, you would have created about 3-4 sources of income.
Having other sources of income and investing all (or most of it) while living off your primary source of income is, in my experience, the fastest way to grow your net worth. And I’m not the only one who thinks that way.
One of my favourite people to learn about investment from, Andrei Jikh, did the same thing. He invested most of the money he made from his side hustle to quickly grow his net worth.
Are you ready to take up the challenge?
Now you know the exact strategies I employed to 5x my net worth.
It’s been about 4 years since my roommate told me that I’m the “…kind of person who would walk into a bar and say ‘free drinks for everyone!’” But when I look back I’m always so grateful that she said this to me.
It was the reality check I needed to get serious about my finances and tackle the wrong habits that made me over-spend.
If you’re like the way I was, I hope the tips I shared will help you out or at least give you a blueprint along which to fashion your money habits.
The key is to not hate yourself for your bad money habits but rather use it as a clue to create smart strategies that will help you save and invest better.
And for those who were expecting a screenshot of my investment portfolio or savings account, I’m sorry I wasn’t as brave as Andrei to make mine public. Hopefully one day I will.
Keep shining,
Mary Victoria 💋
P.S.
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