Get money savvy

2016-05-19 06:00

WITH the current environment of rising interest rates and rising inflation, and thus increased living expenses, South Africans face greater financial pressure – which may impact their ability to save, or increase their savings. With some forward planning and creative thinking, this need not be the case however. If you have not already implemented these habits, there are some practical things you can do to streamline your spending to enable you to keep your savings at an appropriate level.

Tips to help you save more:

Pay yourself first

There is a saying that you should pay yourself first. The idea is that you ensure that you save some money before paying all the expenses, instead of paying all your expenses first and then saving any remaining amounts. This way saving also becomes a priority.

Understand and know your expenses

You need to understand all your expenses so you can track how you spend your money.

This can be an exceptionally sobering exercise as you may find that you spend a lot of money on unnecessary things you think you need. Make a list of all expenses and start cutting out these unnecessary items. Ultimately, create a budget and stick to it.

Review and reduce your expenses

This should be ongoing exercise. Some expenses are unavoidable whereas some can be reduced, and in certain cases, even avoided.

Here are some examples:

Be aware of bank charges

• How much have you been paying in bank charges? Make sure you have the appropriate bank account to avoid unnecessary fees.

Reduce debt, pay less interest

• By reducing your debt, you’ll bring down the amount you are paying in interest. You should make sure you understand the interest that is charged on your credit card and retail accounts.

Review insurance annually

• A simple exercise is to amend the value of your car annually to ensure that you are paying the appropriate premium. Similarly, review the value of household goods annually to ensure you are not over-insured and paying unnecessarily high premiums.

Shop and eat smart

• Compile shopping lists and only buy what you need. Plan your meals and where possible buy in bulk. It is advisable to compare prices and even change brands. Cutting down on junk food and being creative with the leftovers can also make a difference. You may even consider starting your own vegetable garden.

Save on utilities

• We all are fully aware of the importance of saving electricity, yet we don’t always implement strategies to lower our electricity bill.

Try switching off the television and lights when not in use, or using energy-efficient appliances and products. Use additional blankets in winter and cut down on heaters.

You could replace all your lights with energy-efficient bulbs, switch to a gas stove, etc. Similarly, save water by replacing your shower heads with water efficient ones, taking shorter showers, getting a tank to collect rain water for the garden and covering your pool to reduce evaporation.

Maintain your car and drive smart

• Make sure that your motor vehicle is maintained properly as failure to do so could result in costly repairs. It will also help in ensuring your car runs efficiently and your petrol bill is reasonable.

One simple tip is to ensure your tyres­ are inflated correctly.

There are also ways to drive more efficiently by keeping a slow steady pace and offloading unnecessary weight, among others.


This information is only intended to be of a general nature and should not be relied upon by any part without obtaining full details from a licenced financial service provider.


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