MONEY CLINIC | How can I navigate the financial demands of the festive season?

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A Sanlam survey found that 54% of South Africans can’t make their money last until the end of the month and this becomes even more challenging at this time of the year during festive season.
A Sanlam survey found that 54% of South Africans can’t make their money last until the end of the month and this becomes even more challenging at this time of the year during festive season.
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'Tis the season to be jolly! But it's challenging to get into the holiday spirit when so many of us are financially stretched and stressed. 

The good news is that South Africans can find clever ways to make the festive season memorable, even if resources are limited. Mariska Oosthuizen, head of brand at Sanlam, says: "Although countless South African households are still feeling the financial impact of the last few years, there are ways to enjoy the season without breaking the proverbial bank. It just calls for a positive, financially confident approach." 

Oosthuizen lists a few tips to help navigate the festive season with confidence;

1. Organise a toy swap

Toys are becoming increasingly expensive, especially during the holiday season! Thankfully, there's a way for you to still 'splurge' on a great toy for your little one without breaking the bank by organising a toy swap.

You can create a swap that's as intimate or as large as you want by deciding how many participating families to include. Best of all, you can donate any extra toys to charity. 

Not only is this great for children, but it is also great for the environment to recycle preloved toys. Think of all the packaging and plastic saved.

2. Give the gift of an investment 

Becoming financially savvy doesn't have to be a lonely journey; you can get the entire family in on it too! That means you can give your young adult children, who are still finding their financial feet, the gift of saving for their long or short-term goals, which is now even easier with fractional share investing. 

Best of all, you can do so without facing the festive season rush through digital platforms like SatrixNOW. These investment tools make it simple for you and your children to grow your money in easy-to-access ETFs, unit trusts, tax-free investments, and retirement annuities.

You can also send investment vouchers to show your loved ones that you're thinking about their future this festive season.

3. Invest in a worthwhile new year's resolution and help your loved ones get financially fit 

Have you considered getting yourself and your loved ones in good financial shape? Growing financial confidence is all about taking ownership of your financial journey, and it can be incredibly empowering to get on top of this side of your life. 

There are countless financial experts whose footsteps you can easily follow by reading their financial wellness books, and they make great gifts as we head into a brand new year. 

4. Don’t get wrapped up in festive season credit  

Experian's 2022 Quarter 1 Consumer Default Index (CDI), which measures South Africans' rolling default loan behaviour, revealed an increase in the December 2021 retail loan CDI from 10.41 to 10.97. The Index attributes this behaviour to the flurry of new credit and unsecured loans taken out during the festive season, leading to increased defaults in the new year. 

For this reason, always be wary of deals that entice you to buy on credit during the holidays and don't get distracted by "no deposit" deals, as these can often cost you far more interest repayments over the longer term. Instead, spend your credit carefully by planning, and don't buy anything you can't afford to pay back easily. Knowing your credit status will help you stay on top of your finances this holiday season, so check your credit score to stay on track financially.  

Questions may be edited for brevity and clarity.

Disclaimer: News24 cannot be held liable for any investment decisions made based on the advice given by independent financial service providers. Under the ECT Act and to the fullest extent possible under the applicable law, News24 disclaims all responsibility or liability for any damages whatsoever resulting from the use of this site in any manner.

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