How to make it financially to the end of 2024

Consumers can make it financially to the end of the year although they are faced with high interest rates, no tax relief and increasing fuel prices.

The 2023 Household Financial Wellness Index by Momentum and Unisa shows that many South Africans overestimate their financial literacy, says Momentum corporate retirement benefit counsellor and financial coach Tshepo Mathato.

In a sample of almost 20 million South Africans, 45.7% assessed themselves as being financially literate although, according to the survey’s criteria, only 15% demonstrated a sound grasp of financial concepts.

In addition, although 54.3% felt that they were not financially literate, as many as 85% scored low on the financial literacy scale.

Mathato says this shows how important sound financial management is.

Here are his tips for consumers on how to make the right changes:

Financial success is a journey, but you cannot undertake a journey if you don’t know where you’re going. Therefore, setting goals is especially important; and

Face uncomfortable truths. It is important to indulge in honest introspection and ask

yourself some uncomfortable questions about your current financial reality.

Focus on goals that will set you up for success by: Compiling a realistic budget; Setting aside an amount each month for your savings; Repaying debt consistently and on time is important. Start with a debt repayment plan for every month to ensure that your debts are always paid;

Thinking about retirement. Many people only start thinking about it when it’s too late. So make sure this is part of any financial plan and that the earlier you start, the better it is; and

Living within your means. Look for ways to cut your expenses.

If you want to find extra money in your budget, you can always go back to some of these hacks: Cut out takeaway coffees; Cut out takeaway meals, especially work lunches that you can prepare at home;

Reduce entertainment costs; Think about buying in bulk by yourself or with others and compare prices of products at various stores using the internet and apps;

Where possible, pay a little extra into your home loan every month.

This is long-held sage advice because by putting in a little more into your bond each month, you will reduce the interest and payment period of your home loan and will become financially free a lot sooner;

Bring your family on board. Make sure your family is aligned with any cost-cutting strategies that you introduce and make sure everyone understands and sticks to the plan;

Practise what you preach. If you want your family and your children to stay the course, you have to do the same. Stay disciplined and strong-willed to save money; and

Get a financial advisor. Even the most talented soccer players can only go so far without a team of coaches, nutritionists and psychologists.

An expert can help you stick to your plan and enhance what you are trying to do.