Owning and managing your finances should be a goal for all of us. Daunting as it may be, your budget is a blueprint to managing your financial wealth and success.
Himal Parbhoo, CEO FNB Retail Cash Investments outlines a few steps that will help you start and manage your personal savings budget:
Step 1: Identify the amount of money you have coming in. This step is important as it will define how much money you can contribute to your household expenses, servicing your debt, savings and investments.
Step 2: Track your spending through your budget. Monitor what your daily and monthly expenses are; and try and eliminate all unnecessary expenditure. This will encourage you to look at ways in which you can save more and reduce debt.
Step 3: A well-defined set of financial goals is important; so, define your short, medium and long-term goals. Your goals will help in ensuring that you allocate your money appropriately within your budget.
Step 4: Look at your current spending habits and adjust them if need be. Hasty purchases can be avoided if you know what your needs, wants and responsibilities are. Rather concentrate on things that are important like savings for emergencies, unexpected expenses and specific goals such as holiday’s and anniversaries and longer-term goals such as education and retirement.
Step 5: Review and keep checking in with your budget. Give yourself a timeline and ensure that you are actively working towards your savings goals.
“The sooner you start saving, the greater the benefit, so make your savings a priority instead of an option,” concludes Parbhoo.