Share

Financial resolutions to keep in 2016

accreditation

1. STICK TO THE BUDGET

This one is non-negotiable. Just as you need to stick to your training plan at gym, you must start using and sticking to a budget.

As we head into a year of rising interest rates and higher inflation, your monthly budget is going to become ever more important.

When you draw up a budget, remember to be realistic about how much you actually spend.

2. CUT THE CREDIT

The best way to avoid the effects of rising interest rates is to avoid credit, where possible. Just as you would cut off all sweets and unhealthy food to lose weight, you need to start avoiding the unnecessary use of credit.

Of course, if you have a home loan, this is unavoidable. But you can still avoid high-cost credit such as store cards and credit cards. If you can’t afford to buy it cash, you can’t afford it. And if you really need it, work out a savings time frame, set aside money each month and then buy it cash.

3. DON’T REACT

Too often, people start going to gym and expect immediate results. Similarly, if you’re invested, be aware of what is happening in the market but maintain your composure and avoid making hasty choices. Remember, you are invested for the long term and it is natural for the markets to move up and down. When you remain invested for the long term, your money has time to recover from any “paper losses” and, at the end of the investment term, you will still have seen a noteworthy increase in your returns.

However, if you panic and sell when the markets are down, you are guaranteed to lose money on your investment.

4. PLAN AHEAD

When you embark on a fitness plan, what you eat is as important as your exercise regime. And the best way to ensure that you are eating healthily is by planning your meals ahead of time.

When it comes to your money, look at the year ahead and start making plans so that you are not caught short or forced to dip into your savings. For example, you know that you need to service your car once a year. If you don’t have a maintenance plan, set aside money each month so that you can cover this cost with cash when the time inevitably comes.

5. BE FLEXIBLE

After a few months of using a particular fitness plan, you need to adopt changes to your exercise regime. This ensures your body is constantly challenged so that you can improve your fitness levels. Similarly, you must review your budget each month and identify where you can cut your expenses.

This will help you build a buffer to help you cope financially when interest rates rise. You may also need to incorporate new expenses as and when your circumstances change – for example, if your child wants to take up a new extracurricular activity at school.

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Voting Booth
Do you believe that the various planned marches against load shedding will prompt government to bring solutions and resolve the power crisis?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes
21% - 103 votes
No
79% - 399 votes
Vote