A guide to smart money management

Many South Africans started 2018 with a financial hangover after overspending in December.

But don’t despair – it’s possible to have a more financially friendly year, starting now. 1. To draw up a budget, start with a list of fixed expenditures and other monthly deductions. Carefully look at what you’re spending on and identify where you might be ‘leaking’ cash on non-essentials like take-aways, entertainment and satellite TV, as well as on essentials like your cellphone, groceries and transport. Once you’ve pinpointed where you could spend less, start cutting back. 2. Even the smallest adjustments can make a meaningful difference long term. Channel extra money into paying off your debt faster, starting with those with the highest interest rates. As your debt repayments start getting smaller, you’ll have more money to allocate to your personal savings and other more worthwhile causes – like saving for retirement, a deposit on a house or a holiday. Set a savings goal and consider it a non-negotiable, essential “expense” on your monthly budget. 4. Be honest about your debt obligations and your expenses so you have a clear, realistic picture of your true monthly spend. 5. Get creative when looking for ways to cut back on costs. You could establish lift-clubs to save money on petrol and switch off lights in unoccupied rooms to save on electricity costs. 6. Don’t carry your credit cards around in your purse/wallet as you might be tempted to spend. Carry a debit card for everyday purchases and save for the more expensive things you want. 7. Use your smart-phone. There are many free apps that make budgeting easy such as 22seven, MyFinancialLife, Sage Pastel My Money and Spending Tracker. – Budget Insurance 3.