Cre­at­ing and main­tain­ing wealth needs a

Sowetan - - Your Money - Owen S Nkomo

It is im­por­tant to pre­pare for ma­jor fi­nan­cial de­ci­sions since most life events will have a di­rect im­pact on your fi­nances.

Whether you are getting mar­ried, buy­ing your first house or start­ing a new job, you will be wor­ried about how this will af­fect your fi­nances.

As you ap­proach each of these ma­jor life events, it is im­por­tant to con­sider the fi­nan­cial con­se­quences of each de­ci­sion.

Be­low are some hard choices and im­por­tant de­ci­sions you have to make about your life to suc­ceed fi­nan­cially:

What ca­reer you fol­low

We all want wealth, but how do we achieve it? It starts with a suc­cess­ful ca­reer that re­lies on your skills and tal­ents. Your ca­reer is the en­gine of your wealth. The more you earn, the eas­ier things should be fi­nan­cially.

You have a very im­por­tant fi­nan­cial as­set that many peo­ple tend to over­look: you.

You will most likely in­crease your hu­man cap­i­tal through study­ing fur­ther or getting a pro­mo­tion.

This will show it­self in the form of an in­crease in your in­come. ●

Whether you marry the right per­son

Peo­ple who say they are ex­pe­ri­enc­ing stress in their re­la­tion­ship men­tion fi­nances as the num­ber one rea­son.

Dis­clos­ing your fi­nan­cial sit­u­a­tion to your part­ner be­fore getting mar­ried is nec­es­sary, re­gard­less of how un­com­fort­able it may be.

This is the time to men­tion debts, loans, in­come sources, in­vest­ments or other fi­nan­cial as­sets or obli­ga­tions.

They say the fastest way to lose your wealth is to get a di­vorce, and a slower way is to marry some­one with bad fi­nan­cial habits.

One way to waste a

The cost of your house

hand­some salary: buy a house you can­not af­ford. If there is one num­ber that drives your fi­nan­cial life, it is your fixed liv­ing ex­penses.

We are talk­ing about reg­u­larly re­cur­ring ex­penses that are un­avoid­able when you own a house, such as bond pay­ments, wa­ter and elec­tric­ity costs, ren­o­va­tions and home in­sur­ance. The lower your fixed liv­ing costs rel­a­tive to your in­come, the eas­ier it is to save.

‘‘ If you are young, time is one of your best friends

Whether you have chil­dren or not

Rais­ing a child is not cheap

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.