We’re going through tough times, which may become tougher, according to Nico Burger, the head of Financial Planning at NMG Benefits.
This means that consumers will be more tempted to tap into their savings to make it through the month.
Burger said: “Eating into your savings today puts pressure on your savings for your future. Now is the time to put your spending habits under the microscope and learn to spend more wisely than ever before.”
Here are seven tips from him on how you can save more and spend less:
1. Track your spending
At the end of the month, go through each line item on your bank statement. Then calculate how much money you spent on your needs and wants. After a few months of looking at your bank statements, you will be able to see where your money “leaks” are and then work to close them, “Spending more wisely could mean something as simple as ordering fewer takeaways and eating at home instead,” Burger says.
2. Have ‘cool off’ periods and stick to them
When you are thinking of buying something expensive, give yourself a period to think before purchasing the item. This will prevent you making impulsive purchases.
3. Don’t lower the amount you save each month
The future is uncertain. Instead of eating into your savings, try to save more. “We’re in a period when saving and preserving our money is critical to our financial futures,” says Burger.
4. Preserve your retirement savings when changing jobs
See your retirement savings as just that: savings for when you retire one day. Cashing out when you change jobs will only jeopardise your financial future. You will also lose out on compound interest, where you earn interest on your interest. Instead, move your retirement fund from your old employer to the retirement fund with your new employer.
5. Challenge yourself to cut your luxury spending
Each person has their own weaknesses such as expensive jewellery or luxury holidays. “Think about your weaknesses, challenge yourself to cut your spending on those items, and redirect that money to your emergency savings account,” Burger says.
6. Invest in an economical vehicle
With the increase in the cost of petrol, it might be worthwhile to look into buying a more economical vehicle. You can save more because you will be spending less on petrol.
7. Talk to a financial adviser
Speak to a trained and qualified financial adviser to support and guide in your journey of reaching your financial goals. “If you are consulting an accredited financial adviser, you won’t make emotional decisions based on the instability we are all facing today,” says Burger.
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