We are well into Spring, a new month that welcomes change, good weather and a week-long of essential chores around the house – and as you do this, remember that your finances need some spring cleaning as well.
“It is important to be in control of your finances, not the other way around, but we all know that spring cleaning your finances can be a daunting task, even for the most seasoned cleaners,” Cowhan Govender, Executive Head – Everyday Banking at Standard Bank. “With Spring upon us, this means a time for cleaning out the closet but it also means taking a closer eye at your finances and ensuring that they too are on track.”
Have you checked on your insurance policies?
Are you scaling down your debt?
Are you updated on your savings and investments?
Amongst many, these are the important questions to note on your journey to financial wellness – the below five tips might just get you started.
· Ditch the denial – The best advice is to ask yourself “what and if there is anything or anyone influencing your money spend” and deciding on the best way to use your cash. Weigh up your income versus your expenses and ensure that money spent does not exceed money received
· Pay your debt smartly – Many people do not understand that being in debt has two costs, the amount of interest you pay each month and the lost opportunity cost of not saving that money. “By making small adjustments to your budgets and pouring any extra money into your debt to settle it faster, you can maximise windfalls and make your money work so much harder.,” adds Govender
· Distinguish between wants and needs – Be real and honest with yourself, and make a list of your expenses with the necessary items high on the list and the luxuries at the bottom. And when your budget runs out before getting to the luxuries, it is better not to purchase these luxuries on credit but rather go without or save up for them.
· Update your budget regularly – Your finances are affected by many things such as the economy, interest, an annual increase in your salary or unforeseen circumstances such as an emergency, which all affect your financial situation. “The key is to try save a little bit extra every month so that you don’t impact your pocket. It is wise to update your budget and mindset accordingly,” says Govender.
· Stick to it – Much like a diet, a budget only works if you stick to it. Sure, you can fall off the wagon every now and then, but it is important to get back on it!