Get saving savvy
With only a few more months left of the year, South Africans should already be thinking about saving for the festive season, “Januworry” and beyond. Here are tips for becoming saving savvy:
Set goals
Set short, medium and longterm goals, with realistic time lines. Next, work out how much you need to save each month.
Budget
Look at old bank statements to see which non-essential expenses, like entertainment, you can cut back on. Earmark that money for achieving your goals and formulate a budget for your expenses, factoring in the amount to be saved.
Save before you spend
Each month put away the amount you’ve committed to saving before you spend it. You can automate the process by setting up a debit order so the money is transferred straight into your savings account, investment or retirement annuity (RA) fund.
Be mindful of spending
Stopping unnecessary splurges can help you save. Draw up a shopping list before you shop; don’t draw cash from banks other than your own; check your bank fees to see whether you’re paying for services you don’t use – if so, you may want to move banks. Using apps and online tools to track spending can also be beneficial.
Delete debt
If you don’t pay off your debt, saving becomes much harder. Start by paying off credit card debt since this incurs the highest interest rates. Then pay off your car, followed by your home.
Get in on group savings
Being part of a group can help develop discipline. Stokvels is an informal scheme run by people who save a set amount each month. Each member has a turn to receive the money each month.
Find a financial advisor
Getting the right advice can save you a significant sum and help you avoid costly mistakes. Plus, a financial advisor can come up with a holistic plan to help you reach your goals. Tshiguvho is chief executive of Metropolitan Retail