Home Short payment terms Start your financial savings journey with these five tips

Start your financial savings journey with these five tips

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For many people, the idea of ​​saving is something they fear they won’t be able to achieve, especially in these difficult times.
Financial challenges such as loss or reduction of income and rising cost of living hamper our ability to save.
However, small, gradual changes in the way you manage your money on a daily basis are important and in the way you think about money can lead to positive saving behavior.
Dhashni Naidoo, head of the FNB’s consumer education program, said saving is about putting money aside regularly for different purposes.
“To help you achieve different goals – saving for emergencies, education, retirement or to buy goods.
“Setting aside money each month takes determination and discipline, and it’s important to choose the right savings product that matches your savings goal.
“Saving, even small amounts, is important for our financial well-being and our resilience,” Naidoo said.

Read also: Tips to increase your retirement savings

Naidoo shared five steps on how you can start saving:
Decide on a savings goal and commit to a plan
The first step is to determine where you are saving. There are many reasons people save, such as for emergencies, education, retirement. Different banks and financial institutions have different means and tools to help you in your savings journey.
Calculate how long you need to reach your goal
Once you’ve decided how much you want to save, you need to figure out how much you can put towards your goal each month and divide that amount by the total amount you need to save. This will then determine how long it will take you to reach your goal. Goals need to be time bound and we need to adjust current spending patterns to free up money to meet goals. To reach your financial goal, you need to be disciplined and stay focused. Always be specific and practical with your goals.
Pay off your debt faster
Paying off your debts sooner will save you money and free up money to save. Paying a little more for your debt can reduce your payment terms and you can finish paying it off faster. Once your debt is paid off, redirect those funds to savings.

Also read: Key Things to Consider Before Taking Credit in These Troubled Times

Control spending by reducing your spending on wants
Cut down on spending on non-essential or luxury items. It takes discipline to readjust our spending behavior. Make a list of those things you don’t need that are nice to have. Then decide which of these you are going to give up, and then save that money in a suitable savings product.
Automate savings
Once you have freed up the money to pay off your debts earlier and reduce your spending on non-essential items, you need to make sure that the money is transferred to savings products. On a monthly basis, you need to make sure that the money is transferred on payday to make sure you don’t spend the money.
Changing your spending behavior and attitude can go a long way in helping you reach your savings goals.
“It’s important to have financial goals because it will help you break down your goals into groups of short, medium and long term goals.
“A more practical and manageable approach could make your savings journey a lot less overwhelming.
“It’s also important that your financial advisor or your bank matches your savings goals with a suitable financial product.
“For example, if you’re saving for an emergency fund, you need an easy-to-access financial product unlike a 32-day notice bank account, because different products meet different financial needs. The key is to ask questions and be clear about what you are saving for and for how long you want to save, ”Naidoo concluded.

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