Your second step is to learn from what you have created. Then you will know the importance of the balance sheet and income statement.

What could Aziz and Lisa learn? Aziz and Lisa might consider using a part of their savings to buy a small home. In this way, they would be building equity. Paying house rent only builds equity for the house owner. They might also consider selling one of their cars and find alternative transportation.

This may seem inconvenient but sometimes it is necessary to sacrifice to build a surplus for investing. There is no free lunch. Aziz and Lisa are prudent with their credit cards. They pay the balance due at the end of the month to avoid high interest rate charges. Credit cards are convenient but the high interest rates will eat into your surplus.

Use your balance sheet and income statement to pinpoint areas where you might be able to economise. Look for ways to reduce high interest rate instalment debt. Never let the principal of compounding work against you.