Nothing about money is cast in stone. Whether your finances include budgets, savings, loans, or insurance; your financial status constantly requires to be revisited and reassessed in order to check if any changes need to be made to your finances or assets.
Steps to consider when “Spring Clean” your finances include:
1. Make a list of all long and short-term expenses:
- These include life cover, car and household expenses, debt, savings, and unnecessary subscriptions.
2. Study your monthly budget:
- This helps you map out your spending habits and offers a realistic reflection of how and where you spend your money. If your expenses exceed your income, cut out things you can do without.
- Learn the difference between needs and wants.
- Eliminate non-essential spending and purchases.
3. Pay off the most expensive debt first.
- Prioritize debt that requires the most financial contribution and carries the highest interest rates.
4. Revisit your policies and insurance:
- Talk to your advisor and Insurer about ways to save money and maximize benefits on policies and products that you’re currently paying for.
5. Saving should be one of your “new year’s resolution” and have savings goals:
- With the 13th cheques and bonuses coming, setup a monthly debit order to an investment account.
- Open a tax-free savings account.
- Always have an emergency fund for any unexpected expenses or emergencies.
6. Be careful of overspending: Track your spending
- See where you spend the most money so you can cut spending.
- Don’t fall into the spending of the festive season, spend money on things you need. In theory, all these tips sound and seem easy but we all know that in practice, they require a lot of discipline and commitment. Working toward financial savvy spending habits not only saves you money but also prepares you for the following year, especially after the pressures that most people fall for during the festive season to make unnecessary purchases.
Spring cleaning your finances means adopting good/healthy spending habits and getting rid of bad money habits. The decisions you make about your money today, will affect your financial health tomorrow; take control of your finances and spend your money wisely.
“Planning is bringing the future into the present so you can do something about it now,” American Businessman and Author, Alan Lakein.
Wishing you all the best with your financial spring cleaning and may you reap the rewards of the financial decision that you’ve taken to take control of your money.
ABOUT THE WRITER:
Palesa Lengolo is the founder and investment educator of Palengo Holdings.
From Stokvel Voice Magazine
For more information on Palesa Lengolo, contact her at: info@palengoholdings.co.za