Janu-worry almost over: Make the most of your finances all year long
While dealing with money is something many people dread, there are some simple steps to help keep a handle on your personal financial well-being.
WE all know that January is actually called Janu-worry, and typically lasts a few months, right?
Many feel the pinch in the month after the festive season, when people get paid early, leaving them with little to live on in the new year.
According to Judy Bryant of Metropa communications, South Africans remain super-stressed by the impact of the Covid-19 pandemic. Bryant added that many people have lost their employment, and those who still have work, didn’t receive the bonuses they usually do at the end of the year.
“We count ourselves lucky if we still have a job,” said Bryant.
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Shafeeka Anthony, marketing manager of JustMoney personal finance website has a few tips to help you feel more in control of your finances, by focussing on three areas where people can begin to make changes to help them feel more in control.
Budget
“Understanding what you spend your money on is the first step in financial planning,” said Anthony.
“The trick is to figure out a way to track your finances that works for you.” She advises using the traditional method of using a spread sheet to keep track of income along with a list of all regular monthly bills, then all the variable expenses.
Anthony explained: “Your variable expenses are those that may change from month to month like groceries and entertainment. Credit card and bank statements are a helpful place to start since they list your monthly payments. Soon you will start to see where your money goes, where you have money left over, and where you can cut back,” said Anthony who also suggested using tools online like a budget calculator.
Adjust
While some things are necessities, those expenses relating to wants rather than needs are the first place to look for ways to adjust spending habits, according to Anthony. “Make a list of what you really need, and only take advantage of sales and special offers if they relate to the items on your list. If the numbers still aren’t adding up, you can look at adjusting your fixed expenses, although doing so will be more difficult as these are items like rent and medical aid,” she advised.
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Reduce debt
While debt can be a good thing, bad debt hampers financial wellbeing, but understanding the difference between them can be tricky.
“Debt is acceptable if, for example, it takes the form of a home loan and allows you to buy a flat or house for your family. Debt however is bad if it does not increase your wealth in the long term. If you are already deep in debt, and dreading the thought of upcoming payments, then it may be time to speak to an expert. You are not alone – get help. Consolidating your debt can reduce your monthly payments and help you pay it off,” explained Anthony.
Start now
When you are in financial trouble, the last thing you want to do is panic, advised Anthony. “Addressing these key areas – budget, spending, and debt – can save your sanity. Anxiety and procrastination are normal at a strange time like this. It seems almost impossible to break free from unhealthy habits and routines. Many people feel frustrated and angry at the situation they find themselves in, ten months into lockdown, with no solution in sight,” she added.
“Calmly assess your income and what you owe. Aim to get an overall picture of your debts and commitments, and where you can cut back and live more within your means,” she said adding that there are helpful resources online such as the JustMoney website, which can help make sense of anyone’s money matters.
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Caxton Local Media Covid-19 reporting
