A Guyanese colleague shared with me her concern about the financial practices of many Jamaicans with whom she interacted. After spending a few years managing a project in our country, she observed that the attitudes towards saving, spending and debt were very different in the two nations.
One major point of divergence, she noted, was that most Guyanese people were very focused on saving to buy a home as their first priority. The consultant remarked that you would hardly see persons in her country driving a car if they did not already own a piece of property.
Another point of difference was that most Guyanese were very embarrassed about having debt that they could not afford to pay. Indebtedness was taboo and there were even cases of persons who attempted suicide because they were so devastated about their unpaid financial obligations.
When comparing her fellow countrymen to Jamaicans she was also amazed at our propensity to spend on luxury items that were beyond our means. Coming from a frugal background, my Guyanese associate experienced bafflement when she viewed the money habits of some Jamaicans.
When priorities are misplaced
While there are financially savvy and financially irresponsible people all over the world, it is a reality that many Jamaicans value spending over saving, and pursue immediate gratification instead of future rewards. Here, 'bling' is revered, and an outward show of possessions can elevate your social status.
It is commonplace to see people utilising the most expensive brands of smartphones, although they don't have any money in their savings accounts. They subscribe to the full cable package each month, but struggle right after payday to find enough money for transportation to attend work or school.
Another fact of life here in Jamaica is that many people will spend freely and copiously on convenience food or entertainment events, yet will reject the cost of purchasing products which can educate and uplift them personally and professionally. We are indeed a nation with mixed-up priorities.
Where do your priorities lie?
Some people fail to make plans for their money and just respond reflexively when a spending desire comes up.
You may believe that you are usually responsible with your spending and that you don't go overboard by buying unnecessary or wasteful items. However, very often you might not even be aware that you have not carefully prioritised the choices you make every day when you use your money.
For example, you may buy an item without considering how your purchase may affect another demand that may present itself later. If you spend $6,000 on a fan to beat the heat, do you know if that money should really have been retained to help you pay for your car insurance due in six months' time?
How to prioritise your expenses
In order to make the right choices with your money, you first need to identify all the financial demands that you may encounter over the course of an entire year. Without this information, you may make inappropriate decisions without even knowing that you are heading in the wrong direction.
Use a detailed budget form to record all the costs that you expect to encounter over the year, and then calculate whether your income will be sufficient to meet your needs. You can download a budget spreadsheet with a comprehensive listing of various types of expenses at www.financiallysmart.org.
If your calculations reveal that your income will be inadequate to cover all your bills, then it's time to prioritise. Review your expenses and see where you can reduce or eliminate items. You have the power of choice to design a realistic budget that allows you to spend in a responsible manner.
Why it's important to prioritise
Even if your budget indicates that your current level of earning is enough to deal with all your needs and wants, you still need to look at prioritising on your spending. Many people do not save or invest as much money as they should in order to create lasting wealth and achieve true financial freedom.
If you create the habit of setting specific, time-bound goals for your future, it will help you to make the right decisions with your money. Once you have clear long-term objectives, you will be more likely to make sacrifices in your current spending and work harder to earn extra income to attain your goals.
We all have limits on the amount of time and money at our disposal, so it's important to make the best use of these precious resources. Take some time to establish firm financial priorities for yourself and your family which will allow you to attain the financial life of your dreams.
Cherryl is a money coach, business mentor and founder of Financially S.M.A.R.T. Services. Her upcoming book, "The 3 Ms of Money" will reveal all the secrets she learned about financial success. Read more on money and business matters at financiallysmartadvice.com and entrepreneursinjamaica.com. E-mail comments to firstname.lastname@example.org.