July is National Savings Month and there is no better time for us South Africans to get proactive with our savings habits. By improving our own savings behaviour and by encouraging others to save we can be the start of a much-admired nationwide savings culture. National Savings Month is an initiative that came about in 2001 by the non-profit organisation, South African Savings Institute (SASI). Objectives of the campaign include raising awareness of fiscal planning and saving as well as getting all citizens informed and active when it comes to investments and savings.
One of the key findings of the 2016 Old Mutual Savings and Investment Monitor, was that a shocking 49% of South Africans (working metropolitan population) were saving less than in 2015. What’s more, the statistics indicated that the savings level of South Africans was less (15%) than the debt level (16%). South Africans are indeed rotten with debt and struggle to maintain a savings culture because of impulsive purchasing behaviour, economic issues, bad financial decisions and having a lack of discipline when it comes to saving and saving habits. Fortunately, it is never too late to start being a good financial steward. Here are a few pointers to better your savings habits and the start of a commended savings culture:
- You are going nowhere without a savings plan and savings goals. What are your future plans and aspirations? Do research and find the best investment provider and options regarding your short, medium or long term goals. These savings goals can include your children’s education, your retirement (a long term goal for example) or buying a house.
- Savings first, deductions later – put your savings away before your debit orders go off and before you get the chance to spend it. You don’t have to start with a big amount. Rather start small (what you can afford to save) and adjust your savings amount(s) accordingly.
- Don’t fall prey to consumerism, the media or advertising. What you think you want is not always what you really need. Stick to your shopping lists while doing groceries and discover your own unique style and trends – don’t get fooled and lose your personal touch when it comes to tech gadgets, clothing and accessories. These items can be expensive, but only if you give in to the overall trend.
- Get creative and try things like a spending freeze. The last leg of winter (July) is the ideal time to cut out unnecessary spending and splurges. Make use of what you currently have available when it comes to food, clothing and household items. Get creative with new recipes, clothing add-ons and ‘rejuvenate’ old furniture to usable, modern pieces.
- Is debt an old friend? You cannot start saving or encourage others to save when you set an example of over-indebtedness. You need to make use of the snowball effect, pay off your smallest debt first and then the bigger one(s). You’ll learn some discipline in the process and can also continue with these habits when you get the chance to start saving properly.
Don’t think just because it is July and winter that your savings habits should also slumber. Create a ripple effect by encouraging others to save money whenever they can. It is never too late to kick-start your own savings behaviour as well.