50 CENTS IS BROKE! 5 WAYS TO AVOID BEING BROKE LIKE HIM!
Many people danced to 50 cents’ hit song ‘ In da club, Go Go Go, shawty its your birthday, we’re gonna party like….’
Infact, 50 Cent’s album “Get Rich or Die Tryin'” helped make him one of the world’s best-selling artists.
However, this is not the focus of this story. The focus is to learn how NOT to be broke like 50cents as he just declared bankruptcy
- Never ever spend more than you earn. According to the released statements, he earns about $185,000 per month from royalties, interests and more. His expenses are about $108,000 monthly for food, clothing, entertainment, house maintenance, baby support and more. On top of his recurring expenses, he has a huge debt of $32,509,550. For you, learn to live within your income. Cut your coat according to your size. No excuses except emergencies.
- Borrowing/debts management; If you must borrow, ensure your debt is towards viable investments or businesses that can generate revenue that covers the interest rate at a minimum. 50 cents somehow managed to incur debts mainly to defend himself against a headphone manufacturer and lawsuits for all sorts of issues. You may not have lawsuits but you are just as guilty if you borrow money to buy items that do not generate revenue and do not appreciate.
- Separate a need from a want; A need is something you absolutely cannot live without e.g food, clothing, shelter, education whilst a want is a nice to have at that point in time. When you earn, focus on meeting your needs and investing the rest. A need is something you must have but a want is something you would like to have. We all have a long list of wants. Your ability to curb this ‘wantology’ (I just coined the phrase) is a big factor that will determine how soon or not you go broke. Of course, it is okay to seldomly spoil oneself by purchasing a few want items based on budget. I know 50 cents is a celebrity and needs to keep up appearances but he could have achieved that still with a little more financial prudence. Who needs a house with 9 kitchens? 52 rooms? No wonder he spent $72,000 a month on his mansion in Connecticut, including $5,000 a month on gardening
For you, you may not be guilty of this luxury but buying every aso-ebi that is released every Saturday is just as lavish especially when you are not related to the couple.
- Be aware of your net value. You need to ensure your assets (combination of all your investment that have the potential to appreciate and can be converted to cash e.g land, cash in bank, treasury bills, stock ) is more than your liabilities (spendings that do not appreciate e.g cars or amounts that are indebted e.g loans payable/borrowings). Your net value should always be positive. Example if all your assets are worth N140,000 and liabilities are N120,000 , it means you are still a positive +N20,000 net value. With this, if you liquidate all your assets, you are able to clear all your liabilities if needed.
- Put all tips above to use! It is not enough to learn only!
What do you think? Share your comments or questions with us please.
From all of at mrsceonaija, we wish you a life devoid of financial mismanagement