Covid-19 continues to be part of our lives, bringing uncertainty.
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Therefore, focusing on managing money effectively and taking charge of our financial futures are encouraged.
Dhashni Naidoo, consumer education programme manager at FNB, advised that money management has never been more important.
Five tips to reduce financial anxiety:
Revisit your budget
It is important to write down all your income and expenses to give you a clear picture of your financial status. You can then start planning how to spend your money. An important part of budgeting is to look at non-essential or luxury expenses. See how you can reduce spending on these items. You should also look at how to reduce your spending on variable expenses. Variable expenses are expenses that change depending on usage, for example, electricity or fuel for your car.
Use less and spend less on variable expenses. You should always strive to have a budget where you are spending less than you earn.
Proactively manage your debt
Paying off debt sooner will save you money. Try to pay a little extra towards your debt each month and consider paying off debt with higher interest rates sooner. If you are struggling to make repayments, contact your service provider to seek assistance and don’t ignore the fact that you owe money.
Have an emergency savings fund
This can be used for emergencies or loss of income. It is advisable to save between one to three months’ worth of your monthly expenses. Start with small amounts each month and increase it as you become better at it. Try to automate savings, so the amount automatically transfers to a saving account on payday.
Join a stokvel or find a saving buddy
Saving in a group is a good way to keep you focused and help you develop the habit of savings. Stokvels or a savings buddy are good ways to help you develop the discipline and habit of saving regularly.
Invest your money for the long-term
Get advice from your bank or a financial advisor on where to invest your money for the long term. There are different investment products to consider, such as tax-free savings or shares, exchange-traded notes, fixed deposits, property, retirement annuities just to name a few. Get more information about these and try to develop an understanding of how the different investment products can help you better plan for a better life in the future.
