This article is reprinted with permission from the London Business Journal
By Ronnie Ajoku
There have been many reports on the falling living standards, rise of food banks and increase in the number of people living from hand to mouth. Let’s face it, most people working in the UK don’t have money to spare, and are far from being financially free.
The reality of it is that most people would not be financially free, despite their wish to be so. In fact, it has been estimated that over 7 million people in the UK are saddled with debt and find it difficult to cope.
A TUC report released earlier this year reveals that the average UK household owes more than £15,000 to banks, credit card companies and other lenders.
The journey to financial freedom is an area that Genistar is familiar with – having helped many people get there – but as with anything else, taking action is a necessity.
“I joined Genistar in September 2010 to increase my income as I had a 37-year debt consolidation (totaling £115,000) secured against my home. This had arisen from ongoing financial strain for various reasons, including self-employment. I was in danger of losing my home for many years as a result.
“Through the Financial Education, I started increasing my monthly mortgage payments by just £25/month and by the end of 2011, I was amazed to see how much the debt had reduced in just a year. I made a decision not to check the balance until my income was stable – which it has been for the past two years. At the end of October 2018, I checked my balance for the first time in several years and was astonished to find that I have reduced the term by a staggering 22 yrs.
“I only have 15 years left of the term now. I am working hard to become an EVP now, which means I will be able to pay off the remaining balance in LESS than two years!
Genistar has saved my home and given me hope to fulfil my goal of financial independence and to help others facing the same financial challenges that I have,” says Vasantha Narayanswami.
The most important thing for anyone in this situation to do is to have a plan, a sort of guide to the way out. In this two-part article we would be looking at some of the steps Genistar recommend people take, as well as the results some people have experienced by doing so.
The first step is to have a plan. “My Financial freedom plan was kickstarted by a personal desire to change my financial position in 2006,” says Caroline Marsh. “I had had enough of just getting by not having enough money to make personal choices. “My business mentor shared with me the power of personal financial planning, which consisted of a vision
of what I wanted and crafting a plan for my personal desires to drive the new business I was embarking upon.
“My Vision consisted of what mattered the most to me. Things that would worry me or even keep me awake at night like my son’s education, helping my family in Zambia, making a difference in my community through my church, personal lifestyle (such as holidays), quality of life, as well as planning for key life events such as retirement.
“Having a financial plan gave me clarity and focus on what to do, and how to set achievable realistic goals for financial freedom,” she added.
Budgeting is the recommended second step. “I set a budget through Genistar’s financial game plan and managed to see my spending through the 10-10-10-70 principle. I put 10% away for my church or family, 10% for my emergency fund, 10% for my retirement plan and kept 70% for my living expenses.
“Before I used to spend a lot of money on food, but from £650 it has gone down to
£400. Before I always used to buy bags and clothing; I didn’t think before I bought. Now I need to ask myself five times if I really need something?
Genistar makes me realise the value of choosing your own retirement plan, not the government plan. I even managed to pay my debt off in 10 months – Genistar showed me how to pay off my debt quicker through debt stacking and by paying the highest interest first,” said Genistar SVP, Mel Berganio.
Making short-term savings is another vital step that is recommended. “Saving is usually the hardest thing that we accomplish in our financial lives,” says Genistar EVP, Barbara Anderson. “I figured that if l did not have a short-term savings fund in case of an emergency, then the consequences would be dire for my family.
“Initially it was hard, but discipline comes by doing uncomfortable things until a habit is formed,” she added.