How to stretch your budget

By Drum Digital
10 December 2015

How to put money back into your pocket

By Vida Li Sik

Tough economic times lie ahead and you may be scratching your head wondering how you will manage to pay for all your expenses.

It’s tempting to cut down on life or funeral insurance, to make more money available for pay for more pressing needs like food, transport, water and lights. Here’s why you shouldn’t do it: you’ll miss out on benefits when you cancel the policy, especially if you have paid premiums for a number of years, says Lee Bromfield, CEO of FNB Life.

“Most policies have waiting periods and if you cancel and reapply you often start at zero,” he warns. “Additionally, whole life policies get cheaper over time for the policyholder and often, when you reapply you might get higher premiums. Even though cancelling your insurance may seem like the easiest option to take, it’s a decision which should never be taken lightly.”

Rather consider the following tips to stretch your budget:

  1. Buy in bulk. Keep an eye out for specials and promotions in the shops. You can buy extra soap, tea or tinned goods that will last you longer than two months. Club money together with family members or friends and share the basic food items.
  2. Make the most of loyalty schemes. Banks and stores offer loyalty programmes. Check out the terms and try and accumulate as many points as possible that you can cash in when needed.
  3. Change your lifestyle. Join a car pool to save on petrol or if you use public transport, consider buying a monthly coupon and travelling by bus. Cut down on buying fast food and pack a lunch, go out less and entertain at home. See how many Rands you could save by swapping your expensive monthly cell phone contract for a pay-as-you-go option.

A willingness to compromise and to be more disciplined with your money will put off the need to make drastic financial decisions, such as cancelling important life insurance.

Find Love!

Men
Women