January is known by many South Africans as “Januworry”. And for many of us, it feels like the longest month of the year. Many consumers get their last paycheck of the year mid-December, during the holidays, which is not ideal. Consumers end up spending more money during December and worry about making payments throughout January. If only you saved up some money to help you get through the difficult times, January would be more bearable.
How do you save more money throughout the year to prevent the Januworry blues?
1. Use the 30-day rule?
The 30-day rule prevents you from making impulsive buying decisions. Instead of making a purchase on the spot, you should rather transfer the purchase amount into your savings account. If you still want to make the purchase within 30 days you can use the money from your savings account. And if you don’t want to make the purchase after 30 days, you can leave the money in your savings account.
Using the 30-day rule will help you realise which purchases are important to you, and which aren’t.
Over time this will help you overcome impulse spending and boost your savings rate.
2. Automate your savings
Saving money can be difficult. Luckily technology can help make this process a lot easier. To help you start saving money, try to put money away before you have a chance to use it. You can do that by setting up automations. The process is very simple and you can set it up from your banking app.
You simply schedule an automation to go off as close to payday as possible and transfer money into your savings account. That way you never have to worry about your saving money monthly.
3. Budget for saving
Savings goes hand-in-hand with budgeting. You’ll find it very difficult to start saving money if you don’t budget for it. You don’t have to create an in-depth budget at all, you just need the basics.
All you’ll have to do is write down all your expenses like savings, groceries, rent/bond costs, travel expenses, cell phone contract, insurance, monthly debt repayments etc. and minus that from your monthly salary.
If you end up in the minus you’ll have to cut down on some expenses. You might be spending too much on groceries, car expenses or you’re making too many unnecessary purchases throughout the month. You’ll have to investigate where your money is going and see where you can reduce your monthly spend.
The more money you cut down on, the more money you’ll have to save.
If you find your monthly debt repayments and living expenses exceed your monthly income, you may need to consider legally reducing your debt repayments through debt review to help you get back on your feet. Read more about the debt review process.
4. Set personal savings goals
One of the best ways to start saving is to know what you’re saving for. You might want to buy a house, go on vacation, save for retirement etc. All of these goals require planning.
You’ll need to establish how much your goals will cost and figure out how much you’ll need to save each month to reach those goals.
Start by setting small fun achievable goals for purchases that you won’t have cash on hand for, like a new TV, a piece of art, a smartphone or a weekend away. Reaching these small goals will give you the confidence to continue saving and reinforce the habit.
5. Open a savings account
Opening a savings account can really boost your savings rate. You’ll save more money along the way by earning interest. You can easily open your savings account on your banking app and start earning interest.
If you want to prevent the Januworry blues, you’ll have to start saving your money. A savings account can come in handy when you need it most. The important thing is that you start saving. The sooner you start the better you’ll get.
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