Make smart money decisions in 2018

At the start of every new year we tell ourselves that this will be the year that we get our finances under control. This will be the year that we save, get our insurance up-to-date or even get a car insurance quote for the first time, stop frivolous spending, and generally spend more responsibly.

To help you start 2018 on your best financial foot, let’s unpack how exactly you can achieve these goals. And yes, you certainly can. After all, you’re not promising yourself that you’ll become a millionaire in 3 months’ time (although anything is possible these days), so with a plan in place you can do it!

Track your expenditure.

You need to understand where your money goes in order to work out where to cut back, where to save, and where you can indulge (treats are important). So, for a minimum of a month, keep a record of where your money is going, and try to be as accurate as possible.

This includes fuel, household bills, that cheeky packet of crisps and can of soda at the petrol station on your way home from work (and before supper, naughty naughty), mobile data top-ups, and everything in between.

A handy hint is to use an app like Mint or GoodBudget, although there’s nothing wrong with using good old-fashioned paper and pen.

Create an accurate budget.

Forewarned is forearmed. Now, that you have a good idea of what you’re doing with your money, you can set about creating an accurate budget. Many of us work with a budget, but oftentimes this is a general layout based on estimates and guesswork.

If you’re really serious about saving and getting your accounts in order, then you need to be accurate.

Here are some tips to help you do just that:

• The non-negotiables: Down to the penny, detail your commitments, like your cellphone contract, insurance, store card repayments, WiFi bill, rent or bond payments, etc.
• Prioritise: List what’s most important in descending order.
• Disposable: Calculate what you have left after your commitments so that you can allocate amounts to your list of priorities.
• Specify your savings: Make your savings contributions automatic, because if you put it aside before you see it, chances are that you won’t miss it.

Where you can save responsibly.

You’ll probably have noticed that there are places where you can trim the fat from your expenses. For instance, if you spend a chunk on a gym membership that you barely use, then perhaps it might be better for you and your budget to cancel your membership and join parkrun and find a group in your area. You can make friends, bond with your family, and keep fit at the same time! You could also download a training app, like the Nike Training Club, for free and use their workouts to keep fit and healthy. This is especially useful if you have a tight schedule and find it hard to prioritise exercise.

Another area where you can save responsibly is your insurance. Take King Price for instance. They offer R1 insurance for expensive items, as well as decreasing premiums for their comprehensive car cover. While it’s nice to know that your premiums decrease by a bit every month, it’s quite amazing when you add your savings up over 12 months… This way, you can see how much you’ve really saved.

Think about it this way. You start off by paying R10 less when you join the King Price family. Your premium then comes down by R10 at the end of your 1st month and by another R10 at the end of your 2nd month.

You’The big picture savings:

• You’ll save R30 after the 2nd month.
• You’ll save R660 after 12 months.
• You’ll save R6, 300 after 3 years!

No strings, no hidden costs, and these monthly savings aren’t influenced by any claims. It’s just pure savings that you can stick back into your budget.

With January over and done with, you’re still in the nick of time to start saving. You can still make better decisions, put these into practice, and end your year stronger than you started. Which is what you want, at the end of the day.