Johannesburg – Minister of Finance Enoch Godongwana will deliver the Budget Speech this afternoon against the backdrop of a tough economy and an even tougher energy crisis.
Budget Insurance says now it’s your turn to gain control of your finances.
“Whether you are trying to get out of debt, save some money, or simply stay in the green, a basic budget is one of the most underrated tools for gaining control of your finances, managing expenditure, saving, and avoiding debt," said Tyrone Lowther, Head of Budget Insurance.
Budget Insurance has offered the following advice for drawing up your 2023 budget:
Making a list of your fixed expenses and other monthly deductions is the first step. Then, compare this list to your income. You should start making plans for how to cut back on your spending if it exceeds your income.
Concentrate first on those areas where cutting back is simpler. Keep in mind that, over time, even the slightest alterations can have a significant impact.
Once your spending has been reduced, you may start using the extra funds to pay off your debt more quickly, beginning with the loans with the highest interest rates.
Whether it's to pay off your credit card debt or put money aside for a family vacation, be sure your budget has a goal. Setting and achieving goals gives life focus, increases enjoyment, and fosters a sense of accomplishment.
Be sensible. The likelihood of you sticking to your budget is small if you set too high an expectation, and achieving it requires deprivation on all fronts.
To get a clear and accurate view of your financial condition, be open and honest about your debt commitments and spending.
Cut, but take caution. You could be tempted to reduce some costs, such as home and car upkeep or your monthly insurance price. Although it might provide some short-term comfort, doing this could end up costing you far more in the long run.
Stockpile. By keeping an eye out for and taking advantage of discounts and deals, you can save thousands per month. You'll be able to stretch your rand and cut your monthly shopping expenses by making more purchases at a lower cost.
Start with or increase the emergency savings you mentioned. Three to six months' worth of expenses should be saved up in your emergency fund, according to recommendations. Start off by setting aside a tiny sum each month. Commit– unless there is a crisis, don't take any money out of this fund.
The 30-day rule and the 10% savings target, though they can be challenging, should be high priorities. As a general rule, try to set aside 10% of your income as savings. Waiting 30 days before deciding whether a luxury item is actually worthwhile will help you avoid quick gratification.
“Remember that even the smallest adjustments in a number of areas of your budget can add up to significant savings. The small changes and sacrifices you make now will be worth it in the long run,” said Lowther.
The Star