Resolution #1: Draw up (and stick to) a Budget

Budget is not a four letter word. How can we know where our money is going if we don’t budget? How can we set spending and saving goals if we don’t know where our money is going? Keeping this resolution is crucial to ones financial success.

Resolution #2: Get organised

File all your bank and credit card statements and utility bills. Check your list of monthly debit orders and cancel any that you no longer need. Keep a file for your day to day spending, such as receipts for food, entertainment and petrol. Arrange everything so you can see where your money is going each month. And now is a good time to get rid of useless financial clutter, like old bank statements for accounts you closed years ago, old cheque stubs (remember those?) and all your payslips from your first job. SARS require you to keep your tax records for five years – after that toss them.

Resolution #3: Build up a savings fund

Always maintain an emergency cash fund. Ideally, the fund should be at least three months income. This way you will not have to cash in investments at an inopportune time or take out a high interest loan if you are suddenly landed with a major expense such as a car repair or medical emergency.

Resolution #4: Pay off your credit cards

Credit card debt is a huge obstacle to getting ahead financially. Those little pieces of plastic are so easy to use, and we tend to forget that it’s real money we’re spending when we whip them out to pay for an impulsive purchase. Despite our good intentions to pay the balance off quickly, the reality is that we often don’t, and end up paying far more for things than we would have paid if we had used cash.

Resolution #5: Review your will

Millions of South Africans don’t have wills. If you have dependents, then no matter how little or how much you own, you need

a will. If you have a Will, check that it is current, particularly if you are recently married (or divorced) or have expanded your family. Protect your loved ones: always have an up-to-date will.
Resolution #6: Review your life cover
It has been estimated that South Africans are massively underinsured.
You need life assurance if you fit into any of the following categories: you have minor children; you’re married and your spouse relies on your income; you own a business or you have debt. A rule of thumb: have enough assurance to cover at least 10 to 15 times your annual earnings. Even better, have your financial advisor prepare a detailed analysis of your assurance needs, including your need for disability and dread disease cover. Also check that your beneficiary nominations are up-to-date.
Hey presto! 2018 off to a good start.