More times than not, savings feel like a sacrifice.
Experts say this doesn’t have to be the case.
Even as the standard of living continues to rise in the country and disposable income for many becomes illusive, the culture of saving has the potential of beating the odds without cutting off enjoyables.
When the practice of spending money sparingly is entrenched in daily life, saving goes beyond putting money in a piggy bank and a jar.
Last year, Metropolitan launched Sisonke in Savings campaign which explored the unconventional ways in which people saved.
Through this, it was found that those who enjoy retail therapy bargained more on discounted sales in shops and so didn’t have to necessarily cut down on shopping.
Realistically speaking, saving small is where it’s at, especially if one is starting the savings culture early.
While adjustment into adult life that involves moving out of your parent’s house, becoming independent and paying your own bills can get a lot, it doesn’t need to hinder you from financial success.
In fact, starting your savings journey as early as yesterday amidst all your costs helps fast-track the success.
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To help you stay the course, Tlalane Ntuli, Chief Marketing Officer at Metropolitan shares five well-known financial blindspots to stay clear of.
Not setting a budget
There are many upsides to being young. One of the biggest is that you probably have more disposable income than you could ever have dreamed of as you might not have a bucket of serious responsibilities. The problem is that you may not keep track of your spending. It is okay to indulge, but your finances may take a hit without moderation.
Take the time to set a budget. Your 20s and 30s are an ideal time to build your emergency savings and start investing in your financial success. Remember, you don’t have to completely deprive yourself. Your goal should be to live within your means and make a few tweaks so that you can invest in your future. You will be amazed at how talking to your peers can help you find easy ways to save that don’t feel like you have to sacrifice a life you deserve and enjoy. It is all about making small adjustments that will see you win in the long term.
Not saving
You should be saving. If you’re spending everything you’re making, it's time for either a readjustment of your choices–or your attitude. Remember that savings doesn’t have to be difficult -it can be small changes that you make like being part of a lift club to save on petrol, purchasing clothes when they are on sale or something as simple as taking a packed lunch instead of buying lunch every day when at work. Take a different view on savings and investigate where you can make changes that can assist you in saving. It is also important to remember that taking out risk cover such as a funeral plan and life cover can help you save in the future as this cover will assist you when life happens, and you have the benefit of not having to dig into your already stretched pocket to fund some of life’s eventualities and unforeseen circumstances.
Not preparing for a fife change
Thinking about and preparing for financial obstacles can help you avoid later heartache. A steady salary today does not guarantee one in the future. What if you get sick? Or something happens that needs a rainy-day fund? All these things are important to consider. Unexpected expenses are bound to come up, but with a little forethought, you’ll be ready.
Remember, though, not to worry yourself sick over things that likely won’t come to fruition. Ideally, having some extra money set aside provides you security and peace of mind so that you’re not overcome with financial anxiety. Your 20s and s30s are an excellent time to consider what life changes could happen throughout the next several years and how they could affect your finances.
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Feeling uncomfortable to talk about money
Most people grow up being told that talking about money is impolite. However, it is important to have money conversations with your collective and not function in a financial silo. Having the money conversations allows you to manage expectation and set some money values in place. While the final say in how you use your money and how you prioritise is yours, having money conversations can assist you especially when you are considering decisions that can have a huge impact on your finances.
Failing to plan
A good financial plan is absolutely necessary to maximise your income, help you become smart with your money and avoid unnecessary financial hurdles. Again, you don’t have to feel fearful about having a financial plan. If you don’t know where to start, you may want to consult a registered financial advisor to help you craft a plan in that will see you flourish financially.
