How to Save Money While in CollegeIt is National Savings Month and in our last discussion we talked about some of the more important reasons to save. The importance of getting debt to manageable levels and then budgeting and monitoring our spending was highlighted. With consumers under pressure at present, where does the money we know we should be saving come from?

The answer is that you will find it when you start distinguishing between your wants and needs. Look at your budget and identify the little “luxury” purchases that could be sacrificed to enable you to save for your future or pay off your debt faster (and in this way reduce the amount of interest you owe overall). Here are a few ideas to help you on your way:

  • Cut back on entertainment. This is one area that can quickly drain resources which could otherwise have been used more wisely.
  • Eliminate “bad habits”. For the sake of your pocket – and your health – cut back on such habits as smoking, drinking, and consuming sugary sweets: your wallet and your waistline will be all the better for it.
  • Shop with a list. This way, you are less likely to fill your basket with unnecessary items, which are typically the biggest culprits when it comes to inflated grocery bills.
  • Avoid “retail therapy”. Don’t use spending as a way to relieve stress or please people, find healthier ways to relax and make people happy.

A wise man once said, “Wisdom does today what it will be happy with tomorrow”. While spending money may feel good, you need to consider how “good” you will feel about your choices in the future.

Proverbs 21:17 says, “He who loves pleasure will be a poor man. He who loves wine and oil will not be rich”.

In this passage, the Bible speaks against wasting your finances and spending unwisely. Some people go to extreme lengths in order to save money. In all likelihood, you don’t have to turn off your car engine when travelling downhill or sit at home in the dark in order to save money. Reviewing your recent purchases and eliminating wasteful spending will go a long way to getting you there. Make the sacrifices you need to today in order to reap the rewards tomorrow.

Lesetja Madiba is a Financial Wellness Consultant at Citadel.

National Savings Month is upon us again. July has been declared Savings Month by the South African Savings Institute in an effort to encourage people to save.

Savings should be an essential part of our financial management but the fact is that, for most of us, it isn’t. Consumers are under pressure and the debt to income ratio now sits at about 78%. That means that not only are people not saving, but most South Africans are spending most of their salaries each month paying back debt.

Before we can start saving and investing, we need to start get our debt levels under control. Only once this is achieved can we effectively save. It is important to save for the following reasons:

  • Emergencies. “Life happens”, as they say, and should you find yourself in a situation where you burst two tyres or are temporarily out of work, you can fall back on your emergency fund. Often people are forced into debt for lack of this safety net and repaying this debt then becomes an added burden, and one you have to live with long after the crisis has been resolved.
  • Creating financial independence. You need sufficient money saved and invested so that when you no longer work, your money can work for you and sustain you. This requires a strict savings and investment discipline throughout your working life.
  • Short, medium and long term goals. Saving for that holiday or new car - and being able to pay for it in cash - eliminates the lingering financial stress that paying off such items on credit brings. It means that you are in a better financial position in the long term as you are not paying the bank to service your debt, but the bank is paying you interest as you are able to continue saving towards the next goal. Make sure that your goals are financially sound, that attaining them will enable you to continue living within your means, and that you don’t put off savings for your retirement.

Once you know what you saving for, you will be more disciplined in order to achieve it. Saving for the sake of saving doesn’t work. Remember that it is never to early or too late to start saving. As long as you have some sort of income, be it a salary (for most of us) or an allowance/pocket money (for varsity students and teens) you can save a portion of it. It is recommended that you save at least 15% of your monthly income. While it may not seem like much, with time, you will be pleasantly surprised.

Proverbs 21:20 says “The wise store up choice food and olive oil, but fools gulp theirs down.”

While there are many demands on our pocket, the Bible in this passage speaks against wasting our finances. The benefits of saving and investing means you can enjoy peace of mind and secure a better financial tomorrow. There is wisdom in that.

Lesetja Madiba is a Financial Wellness Consultant at Citadel.

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couples fight moneyWe have spoken about financial accountability and being responsible for yourself and – particularly later on in life – those you care for. 

We have also spoken about some lessons that not only the youth but everyone should take to heart.

One of the common questions that has come up has been: how do couples handle money?

Regardless of whether or not someone has a surplus of money, finances can be a big source of conflict.

What is it that we need to consider when handling money as a couple? Regardless of your age, consider the following:

  • A couple that is dating will have a very different conversation about money than a couple that is looking to marry or one that is married.
  • Communicate with each other about your finances and seek guidance when in need. Do not leave it up to chance or “go with the flow”.
  • Financial support is seen as an emotional need. Being responsible for and accountable to each other will ensure that you are able to meet this need for your partner.
  • Budget together and review this budget regularly. This way you know the state of your financial affairs and very little comes as a surprise. As a start be sure to record all purchases and expenses so no money slips through the cracks until you develop financial discipline as a couple.
  • Combine your resources. You are a union and you can’t want to function separate of your spouse/partner.

The Bible in Proverbs 21:5 says: “The plans of the diligent lead surely to plenty. But those of everyone who is hasty, surely to poverty”.

Remember to separate financial talks from relationship talks. Your biggest advantage will be to approach your finances logically rather than emotionally and to remove any unnecessary pressure and influence.

Lesetja Madiba is a Financial Wellness Consultant at Citadel.

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Personal Financial Coaching with Yena Khuboni

IMG 20170801 WA0002Yena Khuboni is a Financial Wellness Consultant and has a B.Comm triple major in Information Systems, Internal Auditing, Finance & Management Accounting.
She discusses Personal Finances live on a Friday during Changing Gear at 17h00.
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