In today’s world, it is very easy to spend more than budgeted in one sitting. Merely surfing the internet can make you spend more than planned. From buying shawarma to buying airtime to hangouts with your friends, etc. Earning is sweet, spending is sweeter. Even when your earnings increase, most assume they would then have more money to save. Unfortunately, that may not be so as our expenditure increases in line with our earnings. Your taste begins to change. The ₦8,000 shoes you used to love no longer appeal to you. You now want the pair of shoes priced at ₦15,000. To manage this situation, effective budgeting is recommended. We highly recommend you spare a few minutes to read our previous article on the art of budgeting to learn practical means to effective budgeting before continuing with this article.

While spending is a tedious task to keep in check, it is also important to track your savings as saving can be quite addictive. You find yourself willing to save your feeding allowance. To ensure you are making effective spending and saving decisions, there is a need to balance spending and saving.

To create a balance between your spending and saving, you should determine the portion of your income you intend to spend and the portion you intend to save within a measurable period. To make it more practical, let us assume you earn ₦100,000 monthly, you can set aside ₦20,000 for savings, ₦60,000 for regular expenditure and ₦20,000 as emergency funds. It is important to set a clear target for your savings to ensure a balance. You could set a target such as saving ₦240,000 in a year. Referencing the example used, setting ₦20,000 as your monthly savings for the twelve (12) months in a year will help meet the target of ₦240,000. Thus, this should be strictly adhered to in order not to shortchange your spending or savings.

The instance stated above stipulates a specific income range however, in reality, some of us do not have a fixed income amount monthly or periodically. How do we go about this? By using percentages to compute the allocations. Dennis Harhalakis, the founder of Cambridge Money Coaching, stated that a good guide is to allocate 50% to needs, 30% to wants and 20% to savings (Wood, 2020). Putting this to practice and committing conscious efforts to ensure its accomplishments would enable a balance between your spending and saving.

A key principle to remember is to pay yourself first i.e. save and invest. As soon as that income drops, save first. Do not procrastinate. Ensure to pay yourself first before paying others i.e. spending.

There may be times when keeping to the principle can be strenuous. I recommend automating your savings to ensure you practice the principle. There are several saving apps available such as Piggyvest, Cowrywise, Investa, etc. There are features on these apps that help you pay yourself first. You can place a standing order to ensure that a certain amount is deducted into your savings account periodically.

To spend is human, to create a balance between spending and saving requires divine intervention. Save today to help yourself create a financially independent future.

Please drop your questions, comments and other suggestions in the comment box, share this article and engage with us via our social media platforms @ broadstreetfinancialreview on Facebook, Instagram and LinkedIn.

Thank you for reading and look out for our next article!


Wood, C. (2020, September 1). How to Balance Spending and Saving. HelloGrads.


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