During National Savings Month consumers were encouraged to pick up conversations around saving and investments; with the aim of saving more, spending less and creating awareness around effective money management strategies.
While this laid the foundations to help build a cohesive savings culture in South Africa, consumers are still encouraged to maintain this savings mindset. “A savings mindset is an ongoing process and if executed correctly will help you and your family in the future,” says Ilse Smuts, Head of Marketing, FNB Savings and Cash Investments.
She adds that, “The volatile economy has exhausted household expenditure and has forced consumers to re-evaluate their spending habits and look for simple saving methods.”
Emphasis needs to be placed on creating a saving strategy that is aligned to your life-goals, needs and wants. Some will save towards wedding related expenses, anniversaries, significant birthday’s, local or international holidays or home renovations, others will open a Savings Account in case of emergency, while others will save to be able to spoil themselves with, for example a branded leather handbag or designer shoes. “Whatever your savings goal is, ensure that you start saving sooner rather than later.”
Smuts outlines 5 core saving principles which will help you in building your savings strategy:
- Live within your means: Don’t overspend on things that you don’t need. Look at your current situation and assess what is important and what is unnecessary in your life. “Over extending ourselves with unnecessary debt just adds strain to relationships and is not sustainable in the long-term.”
- Have a goal-based mindset: Your monthly savings goals should speak to your household and family needs. Determine your short, medium or long-term goals as this will help eliminate wasteful expenditure and help you identify saving avenues.
- Prioritise your budget: A well-managed budget will help you keep track of your expenses and your savings. Ensure that this budget is kept up-to-date and includes all your household expenses.
- Pay yourself first: Key to enjoying your money is to pay yourself first. Allocate a certain amount to yourself – which you can use in case of emergency, to spoil yourself or to save towards a specific goal.
- Have a Savings Account that you will use: Build your savings with a savings account or a cash investment account that will help you save and accumulate wealth over time.
Discipline and commitment is needed to ensure that you stick to your savings goals. “Whether big or small, your initial saving steps will make a difference and help in building a saving culture in South Africa,” concludes Smuts.