Money Matters: Make Those Resolutions Real!

Money-Saving Tips Just For Students

By Vanessa Papas

Miley Cyrus vowed to drink more water, Khloé Kardashian aimed to lose weight and Kylie Jenner announced her New Year’s resolution was to stop being spendthrift. “Just don’t spend any money. None – only the necessary… I’m just focused on business at this point.”

Sure, Kylie’s intentions may have been good, but reflecting back on her expenditure proves she failed dismally at sticking to this resolution. Aiming to save money is never an easy feat. After all, the bills keep piling up no matter how determined you are to stick to your ‘save’ resolution.


This time of the year is particularly bad. You never know exactly when it hits you, but somewhere between the Christmas shopping and the New Year celebrations, you start to worry about your personal finances. Again! Why not make 2018 the year in which you take the first steps towards financial independence, a debt-free life and, if you get these steps right, real wealth? To start you on the road to making this dream a reality, Martin de Kock, CA (SA), CFA and director of Ascor Independent Wealth Manages, suggests the following nine steps. Each has a significant impact on its own, and applying all nine will really shift gears for your generating personal wealth. Stay committed and take one small step at a time.

Budget: “Setting up a budget is like the instruction to floss your teeth every night. You know you should do it, but it seems like so much effort. It is actually very simple and the most powerful tool to save you money. Make sure to give every single rand you earn a job. Do not simply set aside a sum of money for a certain goal – specify exactly what you are going to do with it. A budget will not only help you to plan, but it often opens your eyes to the ways in which you waste money, too.”

Have A Plan: “This might sound like Step One, but it is slightly wider. When we ask people why they want to save or invest, they often come up with vague answers like, ‘I want to be wealthy’ or ‘I want to stop worrying’. While any goal is better than no goal, a specific goal is even better. A bride saving up to pay for her R90 000 wedding is much more successful than one who simply says that she wants to have money to get married. Be specific when you dream. Do you want to put your children through university? Do you want to travel to New York? Be specific.”

Pay Yourself First: “This advice simply means that you should take care of your own retirement and savings first, before paying tax and expenses. Did you know that you can pay 27.5 percent of your income or up to R350 000 into a retirement annuity? This contribution is tax deductible, which means SARS subsidises the contribution to the extent of your tax rate. You not only add to your retirement provision, you also pay less tax on your income. A good financial advisor can help you decide which funds to invest in and even help you save in a tax-free savings account.”

Settle Debt: “Yes, you know this. But be smart about it. Single out your most expensive debt, the debt that charges the most in interest, and pay a bit more than is required every month. By paying your expensive debt off faster, you save on that unnecessary expensive interest, which is a sure-fire way to build wealth. When you have settled a debt, add this monthly payment to the next debt you want to pay off. It will create a snowball effect and you will start settling debt at an increased rate. As a secondary benefit, you will feel more motivated to pay your debt as you see it decline and your savings grow.”

Track Your Expenses: “If you want to be motivated to save, invest and settle debt, make sure to track your expenses and income. There are several apps and programmes, often available for free, that will allow you to track all your expenses and income. Once you get into the habit, you will find that it really helps to see exactly where your money is coming from and where it is going.”

Have A Side-Hustle: “Selling baked goods or walking dogs for extra money may seem like a silly endeavour, but it has helped countless people get started on their road to wealth. For one, a side-hustle helps you realise that you are worth more than your salary and for another, the extra few rands can accelerate your debt repayment and savings efforts. Nothing beats the first time you get paid for something that you thought of, and did, all on your own. For those who cannot think of any side-hustle ideas, Google the term and you will find a whole community dedicated to side-hustles and making extra money.”

Cash Is King: “While credit cards and debit cards are very convenient, you end up spending more when you do not physically see the money leaving your wallet. Tied to your new practice of setting a budget, you could start drawing the cash for certain budget items and only spending that. Setting aside your grocery money, in cash, is a good practice to start with. Using different envelopes for different expenditure types could also help.”

Save: “Whether it’s a small piggy-bank or a money market account or something more sophisticated, start saving as soon as possible. Newton did not refer to the power of compound interest as the eighth wonder of the world for nothing. Like the practice of paying your debt, saving some money will be difficult at first, but it will soon turn into a very rewarding, and addictive, habit when you see the funds grow.”

Create An Emergency Fund: “As part of this practice of saving, aim to first save up an emergency fund of R10 000. This will act as a buffer between life’s unexpected expenses and the need to use your credit card and fall back into debt. Be very strict about how you use these funds. A scheduled vehicle service or holiday is not an emergency, but an insurance excess on an unexpected accident is.”