RECENTLY, South Africans took to social media to discuss their money struggles and as a result the hashtag #salarydepression trended.
While financial concerns were voiced, people also shared tips to help others take control of their financial lives. The conversations showed an increasing interest from earners to adopt a money-savvy approach to help them get the most out of their monthly salary. Capitec Bank marketing and communications executive Francois Viviers said: “We know the current economic times are not easy, but there are a number of ways to take control of your financial life and live better. Whether it is cutting back on unnecessary expenses or growing a new income stream, you don’t have to be a victim of your current financial situation.
Here are tips to help you better manage your money:
- Cut back on unnecessary spending
Get up close and personal with your bank statement. Firstly, interrogate your monthly debit orders. Do you really need all the subscriptions you have? You may not be using those video or audio streaming services as much as you think. Also, it is possible to cut back on the cost of some debit orders. For instance, if you feel you have managed your insurance policy well, call your insurer and see if they are willing to offer you a better rate. Secondly, take a look at your disposable income. Where does your money go? How can you cut back on non-essential spending? For instance, a dinner at a restaurant may set you back R150, while deciding to eat in could save you R90.
When cutting back on spending many people overlook the cost of their bank fees. Check your bank statement to see what you are paying. Most bundle accounts cost from R110 to R350 per month. Do you really need all the services offered in the bundle?
- Switch to digital banking
Did you know that digital banking transactions are usually more affordable than ones that involve people or physical money? You’ll also save yourself time by not having to travel to your nearest branch or ATM. Download your bank’s app, register and start banking from anywhere around the clock.
Most banking apps allow you to check your balances and bank statements in real time at no extra cost – a great tool when working towards a monthly budget.
- Start a side hustle
Your corporate 8am-5pm salary does not need to be your only source of income. Technology is making it easier to earn an income from the additional resources you have. For instance, Airbnb lets you rent out an unused bedroom in your house and many apps exist that allow you to rent out excess storage space.
Place the money you make from your side hustle into a savings plan rather than using it for everyday items such as clothing or movie tickets. The money will earn interest and you’ll have additional money to grow your side hustle, increasing your earning ability.
- Rethink credit
Not all credit costs the same. Store and credit cards often have higher interest rates than other credit. Use extra money to pay off these loans first. Consolidating your debt into a single loan with a lower interest rate is also a good way to save money.
Shop around to see which bank gives you a better interest rate on your loans and credit cards.
- Earn optimal interest
You work hard to earn your money. So, make sure it is working equally hard for you. Most banks don’t offer clients any interest on positive balances in transactional accounts.
Pay yourself first by transferring the amount you want to save each month into a savings plan. Many people save by transferring the money they have left over at the end of the month. However, you’re likely to save very little this way. If you don’t need access to the money immediately use a fixed-term savings plan to ensure that you earn the highest interest rate possible.
Supplied by Capitec Bank.