I have a friend who is a chief executive officer in the financial services sector in Malawi.
He told me a principle he learnt elsewhere. It says that while human beings have the same standard body temperature, which is around 37 degrees Celsius, when it comes to money, we all have our own standard level at which we operate.
It may be hot or cold, but the human body will regulate itself to remain at or around 37 degrees. Apparently, when it comes to money too, everyone has his or her money level where they are comfortable to live in peace.
When the money they have is below that level, they do not have peace. And even when the money they have is above that level, they do not have peace at all.
Some people have money temperature around K100 000, others K500 000 and others may be K1 million or K10 million. There are also people who are comfortable operating at levels as high as K100 million or K2 billion or K20 billion or more.
If a person is used to operating say at a level of K500 000 and he or she gets K10 million, he or she will get confused and they will stop everything to start spending the money until they have as little as K500 000 or less. Even the one who is used to K1 to K2 million, they should not get K300 million, otherwise, they will go crazy until they finish the big money.
I can relate to this principle when I recall my time in college at the University of Malawi constituent college The Polytechnic, now Malawi University of Business and Applied Sciences (Mubas).
Every semester, we used to get a book allowance from the government and it was K700. That time, that was good money. A bottle of Fanta was costing around K12 and minibus from Blantyre to Zomba was only K3 and a coach from Blantyre to Mzuzu was costing K150. As you can see, K700 could do a lot. At least it could buy more than 50 Fanta bottles!
My roommate and I were used to living with zero to very little money, just some change. So, whenever we got the K700, we could buy one or two books to fulfil the intention of the source of the money and the rest we would buy some clothes and the balance was for tasting some chips and sausages from the student tuck shop and lots of Fanta.
I recall at times my roommate would joke that “we need to finish this money soon, so that we can start to concentrate on our education and start to study again.” This means that not only did the K700 make us busy with spending the money, but it also disturbed our normal education routine.
Indeed, once we spent the whole K700 down to zero, we could now spend a lot of time in the library studying! It means that the money temperature for my roommate and me was may be K10 or K20 only! Anything above that was poisonous to us!
How much is your money temperature? It is important to know your money temperature so that you control the effects of wasting money when luck gifts you big money occasionally. This means that you can train yourself to have some discipline. The same way what happens when you suddenly get the promotion you wanted. May be you were earning K300 000 per month and you get promoted to a rank where you now take home K500 000 per month. The increase in salary is K200 000.
You may find that with that you change location with the new house rentals increasing by K120 000 and you take a loan to buy a vehicle, which forces you to pay K70 000 a month and you change schools where your kids go and the increase is say K50 000 and so on.
Before you realise, while your salary went up by K200 000 only, you have changed your life and monthly expenses by K240 000 or more. And then you find that your life is worse off now despite the promotion and salary increase.
It’s down to the money temperature principle. Let us all work to keep increasing our money temperature. Invest the excess money. Always have projects where you can inject the excess money that is ‘itching you’! Good luck!!
