10 savings tips for 2012

Don’t blow your bonus

Although most of us have worked our hands to the bone over the last year, there will be no long-term benefit if we blow our bonuses on things we want today. Rather use half your bonus to treat yourself, and the other half to invest or pay off your most expensive debts.

Give your savings a salary increase

When you get your annual salary increase, be sure to increase the money you’re saving by the same percentage. This will lead to the amount you’re putting away roughly doubling every ten years.

Tie Rand amounts to your new year’s resolutions

Every decision we make has a financial consequence. Once you have made your big decisions for 2012, understand how much you expect to spend or save as a consequence and make sure you check up on yourself to see that it remains under control.

Decide where you want to shop

We all know how comfortable it is to run into the corner convenience shop for our groceries or family dinner after work. Remember though that this convenience often comes at a price. Rather draw up a weekly shopping list and go buy your supplies where you will get the best prices.

Pack your own lunch.

If you buy your lunch at work – or school – every day at a cost of about R30, this means that you will end up spending R150 a week, or R600 a month on lunch. By  packing your own lunch (at a cost of around R10 for something healthy and decent), you will be able to save R100 a week, or R400 a month.
 
Budget – and check up!

It is astounding to see how much money falls through the cracks if we do not keep track of our daily expenses. Drawing up a budget can be done in half an hour if you really put your mind to it. Checking how well you managed to stick to it at the end of every month is, however, the most important part of the exercise. To make it fun, budget for a little treat for yourself if you come in on target.

Don’t upgrade!

We tend to vastly over-estimate how much happier better luxuries will make us. When the time comes to replace those big-ticket items like your car, television, home or lounge suite, try to resist the temptation to buy something bigger and fancier. If what you had did a fine job yesterday, it is likely that something similar will do a fine job tomorrow.

Define the value you want to give

Can you remember what presents you got last Christmas? Most of us can’t. The experiences we have tend to stick around much longer. For most of us, our idea of giving to others is defined by how much money we spend, whether it be a birthday present or our contributions to charity. Often, it is much more meaningful to give others our time or an experience. This will not only save you a lot of money, but will most likely also make the gift more memorable for the recipient.

Make your expensive debts go away

When you manage to free up some funds by following the above steps, use the money that becomes available to pay off your most expensive debts. Clothing accounts and personal loans, for example, will probably fall into this category. And once they’re paid, close those accounts and keep them closed.

Get the growth you need

Make sure that the money you invest will generate enough growth to allow you to achieve your financial objectives. Sometimes keeping the money in the bank or under the mattress is the most unsafe thing we can do as it only guarantees that we will not achieve enough growth to lead our desired lifestyles. A properly qualified, reputable financial planner that preferably provides advice for a fee (and NOT a product for a commission!) will be able to help you understand what you need your money to achieve, and how to go about achieving it with as much certainty as possible.\