Cape Town - "I have a savings plan," writes Fin24 user Andre Bothma.
He managed to move from being R20 000 in debt to now saving R 8 000 per month - and even giving R5 000 per month to his local church.
"Our combined salary is R30 000, thus we live off 56% of our income," he explains. At the same time he cautions that his plan is "simple, but difficult".
You must get a written budget. Track your expenses from your bank statements and create a draft budget from that. The first step is to make sure that your income is more than your expenses.
- Save monthly to hit a third of your monthly salary. If you earn R3 000 per month, your target for this step is R1 000. This amount saved is only for emergencies;
- Pay off all your debt from the smallest to largest. This is the debt snowball method and does not include your house payment;
- Now build your emergency fund up until you have three to six months of living expenses saved up;
- Put 15% of your gross income towards retirement savings;
- Pay off your mortgage bond as fast as possible;
- Broaden your investment portfolio, but never invest in something you don’t understand.
Do you have a successful savings plan or story? Share it with us.