MANAGING your money should be a priority, especially as times are getting harder.
John Manyike, head of financial education at Old Mutual, suggested people review their budgets.
“In the same way that the national government looked hard at the state of the economy last week, we need to review our challenges and opportunities every year.
“Last year, we were hit by an increase in the price of fuel and electricity, as well as the VAT hike. This has led some people to use dodgy loans, store credit and quick financial fixes to buy groceries.”
Here is advice on creating and managing a tough budget:
Commit to a budget
- Write up a full budget and stick to it.
- Make a list of wants and needs. Focus on the needs. Only choose from your wants list if you can afford it. Don’t forget to give yourself a small treat once in a while.
- Involve your family in balancing the budget.
- Cut off unrealistic demands and expectations.
Cut your transport costs
- Look for schools closer to home if transport costs are eating in your budget. Another option is to move closer to your workplace.
Keep your family healthy
- Prepare lunches at home for school and work. You save on money spent at tuck shops and canteens. You are also more likely to make healthier food.
Quit bad habits
- Stop smoking and cut down on booze – you’ll save a lot of money.
Stay up to date
- Stay up to date on the latest news on taxes and tariff increases such as the fuel price. Fuel increases increase your expenses directly while other taxes increase them indirectly as well.
Keep saving
- I know it gets tiring hearing it but no matter what, don’t stop saving.
- Stay committed to your long-term goals such as higher education and a comfortable retirement plan.
- Take advantage of any tax-free savings options available to you.
Don’t live to impress
- Don’t abuse your credit, savings and income by showing off with wealth you don’t have. You will suffer later for money you are wasting now.