Budget day and being Ken [Article]

How many of us admire Ken Ofori-Atta?  I want you to stop for a minute and think about stepping into his shoes. His love for white apparel is customary and it is one of the odd questions I’ll have for him if I get to meet him one day.

You may be at odds with him with the direction in which he is driving the Ghanaian economy. But I still want you to emulate the Minister of Finance tomorrow as he reveals what our tax and spending policies will be for the next 12 months.  Budget Day is here once again with Ken.

Don’t feel like a fish out of water because I am not asking you to determine whether removal of the 50% benchmark values on 32 categories of items at the ports is the right or wrong thing to do.  Rather, I am imploring you to put together your personal budget statement – one that captures your household’s finances.

Plotting a pathway with the intent to improving one’s personal financial circumstances is not a novelty. However, with household spending power reducing with an ever-increasing cost of living, it is trite knowledge that those whose income levels have survived the Covid-19 pandemic are observing lower bank balances each month-end.  And while for some, there is some semblance of stability in their finances, we all know how quickly our circumstances can change. Anything could be around the corner to derail our steady state.

So what’s the plan? Set out to have an evening to yourself. With a cold, Good Day energy drink or a cup of tea with Creamy Plus, pull out your bank or mobile money statements to take a proper look at where your money has been going (or not going).

The fundamentals of this review require you to categorise all your inflows and outflows. You should surely factor in recent price hikes into your analysis. Aggregate both lists and strike the difference. Is your spending in excess of your income? That’s the bright, red flag right there which requires prompt action to remedy the situation. A reasonable surplus at the end of each month is no reason to be contented either. You still need to increase the surplus by making your money work harder.

Drilling further down, you can sub-categorise your spending into food, transport, kids’ education, utilities etc. More is better than less.  This will reveal where cut backs are possible and enable you identify priority areas to which your money can go. The internet is replete with online budget planners to help you. Free to use, you’ll have reminders of what to add. They also do the math for those with numerophobia or arithmophobia.

With all these sorted, there is yet one more way to remain in the Finance Minister’s shoes. You will need to inform the people it affects. Switch the Ghana Parliament for the dining table and gather the household around to discuss everything. You’ll probably have about six people to convince rather than 30 million. The need for your policy changes must be explained and share exactly why you are choosing one expense over another.

For your spending plan to work and succeed, you will all need to be sailing in the same direction – from newly-born baby to nonagenarian parents.

Being Ken Ofori-Ata can’t be that hard after all.

The writer is the CEO of CashBack Capital Microfinance Limited