By Emsie Martin
With prices sky-rocketing daily, it becomes all the more difficult to think about saving. First you had to contend with school fees, then study fees and now those are behind you – there are doctors, fuel, electricity and food that get more expensive by the day. There just never is extra money to save. To improve daily habits and your way of living can definitely be the start of your saving culture. It might be easier for someone earning a big salary to set aside some money, but what do you do if you are just getting by?
Perhaps you should start by remembering that you are the money’s boss and you decide where your money goes to and what you are going to do with it.
Old Mutual‘s Savings and Investment Monitor (2017) indicates that a shocking 52% of South Africans’ income cannot keep up with their expenditure at least once a year. Sound familiar?
Matthys Potgieter, spokesperson and debt expert at DebtSafe, says South Africans are indeed wallowing in debt and struggle to maintain a savings culture.
Following are some savings tips to get you started:
- Avoid unnecessary debt, especially short-term loans that will be subtracted from your account at the end of the month. You will save the administrative cost that usually amount to at least R120 and leave a huge gap in your salary.
- Live within your income and guard against ‘luxuries’ that aren’t really necessary.
- Try saving approximately 10% of your income. Unfortunately, this is not always possible if you just scrape by every month.
- Keep to your grocery list when shopping and compare prices.
- Start putting away your purchase slips. At the end of the month go through them and add up all the unnecessary items. You will be surprised about the money you could have saved.
- Don’t make two trips because you forgot something – rather make a list ahead of time.
- It’s not always possible to be part of a lift club, but you can save fuel in another way, such as driving 5 km below the speed limit.
- Perhaps you could also save on unnecessary speeding tickets.
- Do you have two cell phone contracts? Are they really necessary? Switch to a pre-paid cell phone service – it will make you think twice about chatting or using data unnecessarily, especially if you have to pay it yourself.
- Don’t renew the other contract and don’t use that money, save it.
- Make a few sums, smoking costs a lot of money and in the long run it harms your health as well, which will in its turn also cost money. Here you can save at least R1 000 per month.
- You pay R400 to belong to the gym; actually you can’t afford it and don’t always have to go there, but you feel it is something you do for yourself. There are many free apps that can be downloaded and then you can exercise in the comfort of your home and in the evenings take a brisk walk. All that it will cost, is self-discipline.
- Have a look at your insurance and find out if there isn’t a cheaper option.
- It costs a lot to invite friends over for a braai. Rather make it a bring and braai. It will cost less and you will still have a good time hanging out with your friends.
- Don’t leave electronic equipment switched on; even when switched off electronic appliances can make out between 10-12% of your electricity bill.
- Switch on the lights only when you need to and replace them with energy-saving LED lights. They save you up to 85% more power than traditional globes and also last up to 25 times longer. They can be quite expensive, but because they last so much longer you should feel the difference in your wallet pretty soon.
- Televisions, DVD players, decoders and sound systems use power even when not in use.
- Of course the golden rule to lower your electricity consumption is to use just what you need – for example, boil just the amount of water you need for coffee, rather than a whole kettle full.
- A good start which everyone can remember: don’t leave the fridge door open while deciding about that snack. Decide beforehand what you want to take out and close the door as soon as possible to prevent all the cold air from escaping.
- Always ask for discount when paying cash.
- Ask about generic medication for chronic illnesses.
You cannot start saving or encourage others to do so when you set a debt-ridden example. Potgieter says you can apply the snowball effect – pay your ‘smaller’ debts first and then the ‘big’ ones. Or consider the flood effect – this is when you pay off debt with the most interest first. In the process you will learn discipline and can also continue with this habit as soon as you are able to start saving.