how to improve personal finances

How to improve Personal Finances: Critical going forward.

It is a global fact that the current Covid-19 Pandemic has created the greatest challenge to mankind today. It is not only a health problem but an economic problem too.

How do we improve our personal financial condition? This is the major question facing very many people today. So many jobs are lost and businesses have closed down. What is the way forward? That is what is on the mind of most people today.

The way forward is to have faith and great hope for the future. Our future is in the picture we see in our mind. Make effort to focus only on good things.

If you see nothing good to look at the moment, focus on the beautiful sky and flowers around you. It will help you realize that our Great God is still on the Throne. Most great things in life are free of charge.

The oxygen we breathe, and the enduring love of God and nature. Look for the good in every situation. Good mindset attracts good things. Do not allow worry to kill your dreams.

Face today and tomorrow with knowledge. One of the most important knowledge that will help everyone who desire to be a winner financially going forward is the knowledge of financial literacy.

Financial intelligence is not usually acquired through the normal school curriculum, it is different from academic and professional education. That is why, it does not necessarily require college education to be financially literate and rich.

how to improve personal finances

There is no difference in the level of financial intelligence between the General Manager(GM) who earns fat salary monthly and who spends everything on luxury and personal expenses and that Door Man or Gate Man(GM) who is also working to sustain his basic needs and has nothing at the end of the month left.

They both work to sustain their lifestyle and have no savings or investment at the end of the day. So they are the same. Financial literacy does not depend on how much you earn but it depends on how you spend what you earn.

To move forward, ask yourself, what is your relationship with money. Do you obey the natural law of sowing and reaping where money is concerned?

We have to analyze our individual relationship with money by doing personal cashflow diagnoses using the accounting tool of statement of financial position, also called the balance sheet and the income statement. Let us explain it below.


Income Statement:

This is a statement that shows what we earn as income and what we expend the money on for a particular period. For instance monthly or yearly can be our period of review. It is divided into income and expenses.

  1. Income: we all know what income is. This is what we earn. It is divided into;
  • Active income: income that involves our full participation and our time. For instance salary
  • Passive income: Income that is not depended on our active involvement. It is based on the seed we have sown in the past in the form of investment. When we begin to reap from it, the income is passive. This is the income we should focus on to be able to create wealth. Like Rent income, Royalty, Dividend, Commission etc.

2. Expenses: This is how we spend the money we earn. It is divided into budgeted and unbudgeted expenses

  • Budgeted Expenses: Expenses we planned for within a given period. Like Rent payment, food, taxes etc
  • Unbudgeted Expenses: Expenses we did not plan for within a given period. For instance, car repairs which occurs without notice, impulse buying habit.

how to improve personal finances

Balance Sheet.

This is made up of all the things we owe (liabilities) and all the things that we own (assets). It is a statement that shows where we are at a time.

  1. Asset: This is all the things that we own that brings future income to us. This is where we should sow the seed of money that will generate income in the future. For instance, businesses that brings profit, Real Estate that brings Rent income, automated online business that brings Commission, books that generate Royalties, Shares that bring Dividend etc.
  2. Liabilities; This is the part of our balance sheet that shows all the things that we owe. Like Loan, Mortgage, Credit card etc. They are lifestyles we live today that we will have to make payment for tomorrow. It generates future expenses. Avoid liabilities as much as you can if you want to build wealth. Except where necessary and where it will result in future asset creation or income.

How to improve personal finances requires generating more income than we currently do and building so many incomes generating assets.

There is limit to how much we can reduce our expenses but the focus on expenses should be to form the habit of making budget and spending based on the budget we have made.


Below is the picture by Robert Kiyosaki, the author of rich dad poor dad. A well know coach on personal finance on how the financial statement of the poor, middle class and the rich look like.

how to improve personal finances

Comparing Personal Finance Habit of the Poor, Middle Class and the Rich

The Poor: live from active income to expenses usually spending to cover basic needs of life.

Currently in this pandemic, most income in the form of salary or trading or wages have been eroded and there is nothing coming in to cover the basic expenses and basic needs. These basic needs include; rent payment, food, transportation, clothes etc.

This condition is critical and will require urgent help from people and government palliatives for survival.

What is the way forward in the pandemic? Focus on survival. Seek for all manner of help you can get from people and government to overcome the current situation.

Be hopeful and know that you are not alone in this condition. There are so many people all over the world who are like you right now.

What is the way forward after the pandemic. Take charge of your motivation. When there is life, there is hope. Then ask yourself; What do I have in my hands? What skill do I have or can I learn? How can I start to increase my income and reduce my expenses if possible.

It is easier to reduce your expenses by focusing on spending on only budgeted expenses. Any unbudgeted expenditure that comes up, push it to next period budget and include it as part of next month budget. Stop spending on impulse.

Then increase your income. Do not depend on one source of income. Even when you have a secured salary, note that security is an illusion. What do you have in your hands? What solution can you offer? Start something with your talent and skill.

There is no shame in making a genuine living. Do not focus on what people may say. People are thinking about themselves not you. There is no shame in labour. If you feel you do not have a required skill for what you want to do, get the skill.

Go and learn it right after the lockdown if you cannot start right now. Start online if possible immediately, that is the new normal. Use your time on social media positively, use it to improve your income.

Do not just use social media to keep busy and to sample your photos, time is money. Learn how to improve your income even through social media and when your income improves, still maintain spending on budgeted items only and start a savings.

Incorporate regular saving into your budget, save first and spend what is left. It is good sense to have what will support you in emergency situation that your saving can help solve and handle. People will also support you more when they have seen your individual contribution to the solution.

That is why banks ask for down payment or your commitment fund before supporting you. You will also see opportunities which you would not have seen without saving somewhere.


Your focus should be to create other streams of income. Depending on one stream of income is risky for you and all those who depend on you.

Start a freelancer job with your skill, start a farm, snail farming for instance does not require much land, because you will ask me where is the land. Learn about what you can do on the internet.

Stop giving excuses why you are not doing well. Take control of your life. You are living for yourself not for others. Your target should be to begin to build asset, yes you can. Sow for future financial growth by building asset.

You can look for opportunities that can result in asset building without much financial investment, use your skill to write a book and sell online on without spending any money and begin to earn royalties.

Learn what solution you can offer or resource you can get from website like

Search for skills upgrade you can acquire from website like

how to improve your personal finances

The Middle Class: you may still have your fat salary coming in monthly, be grateful because you are among the lucky few.

We praise God for it. But if you have been affected by the global job loss and business crash, just know that it is not the end of the world. Life must go on. Failing and failure is part of success and not opposite of success.

You must encourage yourself because you are a winner for overcoming Covid-19. You can launch back your business or your job gradually again after the pandemic, remain positive.

Follow the advice above and focus on how to increase your income with your skill and with the current resources you have.

This is not time to do huge capital outlay and risky investment. Focus on how you can create passive income and as your income improves, focus on spending on budget and building asset that generate more passive income.

The wealthy focus on building assets and using it to create multiple streams of income.  As a middle class, do not live on luxury that you are not yet qualified for. That big house you spend so much to maintain is not an asset. It is a liability.

That beautiful car you show off in and spend so much to maintain is not an asset but a liability because it is not bringing any passive income to you.

Some of us have learnt some new ways and skills during this lockdown already, please do not discard them when things become normal.

You can also wish to learn how to build your online business and earn multiple stream online by promoting other companies products and earn affiliate commission or turning your hobbies to passive income. You can start free here

Build your business and let your business build your lifestyle. Do not build luxury lifestyle when you have not built your business.

“Develop your business first before building your house”. .. Proverbs 24:27 

The Rich: please help the poor around you in this difficult time.

And assist to mentor someone who is desirous of making the leap from financial lack to financial security and finally to financial and time freedom.


I hope that with these few words, someone will benefit from it because I have also derived benefits from writing it. I am also learning.

Kindly leave a comment or your experience on the subject matter below and please share with your contacts, it will surely be of help to someone in this difficult time. Sign up for email update and like the post as well.

I appreciate your reading and sharing support. I am happy that someone somewhere is learning something from the posts from the great feedback I get daily.

Help someone by your side.

Bye for now.




10 responses to “How to improve Personal Finances: Critical going forward.”

  1. manuel Avatar

    I am a big fan of Robert Kiyosaki and I have read a few of his books and he always emphasizes on creating assets and actually understanding the real meaning of assets and liabilities as a lot of people actually have liabilities that they call assets because they probably don’t understand what that word means.

    To become wealthy we have to create assets that put money in our pockets. We need to create multiple streams of income. That is a way to guarantee being wealthy. Understanding the simple difference between an asset and a liability can be a life-changer.

    1. Joseph Avatar

      Thanks Manuel, it is a clear and simplified way of passing the financial intelligence education. As an accountant, based on professional training, we have a little different classification of what an asset is. But financial education is different from professional or academic education. For instance, we classify car that is not bringing any income as asset, when it is actually a liability. I am very convinced that Robert Kiyosaki is correct.

      It is common sense that is not common. If we can just focus on creating asset and generating more passive income, we would have solved all money issues. I have a house that I hardly stay in but spend so much in maintenance, this is a liability according to financial intelligence but professionally, I will consider it an asset.

      The good thing about building asset in this era of information technology and globalization is that you can build digital asset for free and begin to earn royalties and commission. It is only ignorance and mindset that limit us.

  2. Philebur Avatar

    Hello there! Thanks for sharing this beautiful content with us, your ideas are indeed valuable. Your article is very informative and Educative and so very important to me. Other than the fact that I’ve learnt how to improve my personal finances. I’ve also had a very awesome read as your website is easy to navigate through and the colors are soothing to the eyes. Thanks a lot…

    1. Joseph Avatar

      Thanks Philebur, I am very glad that you enjoyed and benefited from the article. I appreciate your encouraging words. Please share with others and come back for more great articles.

  3. evans Avatar

    awesome review you have on how to improve personal finances critically going forward.. I must say that a great way I believe you can save your finance is  making a scale of preference on what to spend and when to spend , making the most pressing needs come first before the less pressing need…..

    what an amazing article, thanks for sharing

    1. Joseph Avatar

      Hi Evans, thanks for dropping your comment. Making scale of preference and ranking is done during budgeting. That is why spending based on budget is very key in controlling our spending habit. There is always needs and wants facing money, there is no free money. Even when we do not have current need, as humans, we can even create future non existing need because of the urge to spend. The solution is to budget and stick to it. Even when we deviate a little, we would have controlled a lot of impulse buying.

  4. Jossy Avatar

    Thank you Sir for differentiating between financial intelligence and professional definition of asset, as not all that were classified to be asset in academics yields profit.
    That is the reason so many businesses are re-focusing.

    1. Joseph Avatar

      Thanks so much Oby, it is very important to define and explain it in a very simple way that will make it possible for everyone to tap into the benefit of the knowledge. Financial intelligence does not require too much grammar.

  5. CHILAKA Kimberly Avatar
    CHILAKA Kimberly

    Awesome piece!.. So educative and informative…Thanks for sharing.

    1. Joseph Avatar

      Thanks Kimberly for leaving your comment. I am also glad that you derived benefit from the article. Cheers.

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