8 WAYS TO PLAN FOR THE FUTURE

Now is the time to plan for your future financial needs, and that means saving – no matter how hard you’ve been hit by the pandemic.

---

Covid-19 has wreaked havoc on lives and livelihoods, with many losing their jobs or taking pay cuts and struggling to make ends meet. We’ve had to think of clever ways to make money, and reassess how we plan for possible events like this in the future.

Planning for the future may be daunting, but it’s never been more crucial. Start the new year by sitting down with pen and paper or a smartphone app, and get planning. If possible, hire a certified financial adviser to help.

DRAW UP A BUDGET
Go through your bank statements for the last three months to see where your money is going. If you’ve been hit financially, chances are you’ve already cut spending to the bone. Plan to keep that up – even if you’re back at work at full pay; you now know the uncertainty of the future and the importance of being prepared with savings.

DRAW UP A SAVINGS PLAN
Aim to set aside 20% of your disposable monthly income (what’s left after all your deductions), however little that is. You know now how useful that can be for an unexpected emergency – or for your or your children’s education, a wedding or travel plans. Start small and build up as your finances recover. An app like Moneysmart or My Financial Life (both free) can analyse your spending and show your balance after all bills are paid. Also, make sure you shop around and compare prices before you buy anything.

SORT OUT DEBT
If you are paying off credit cards and loans, start clearing these first – high interest charges can wipe out any savings efforts. If your income has been affected by the pandemic, talk to your bank or creditors today. Most banks have set up measures to help with loans and debt.

CHECK ALL YOUR ACCOUNTS
See if you’re paying unnecessary fees that can be cancelled, or late fees for not paying bills on time. And carefully weigh up subscriptions, cancelling those you don’t really need. (Netflix is nice, but if you have internet, there are many YouTube series you can watch for free).



RE-EXAMINE YOUR INSURANCE
Don’t ditch it: if you’re in an accident or are robbed, you and your family will be far worse off. Surf the net to compare deals, and if you find a cheaper option, call your insurer. Ask them to match it or say you may migrate. Also check that your insurance details are up to date – that you’re not paying for coverage of goods you no longer have and are getting the lower premiums your home security system entitles you to, or that you should be getting as your car ages and drops in value.

LOOK AT YOUR BANK CHARGES
These usually go up each year. Set up a virtual or safely distanced real-time meeting with a consultant to go through your accounts and services. Ask about new or more affordable products and close any accounts you’re not using that may carry service fees.

CHECK YOUR CREDIT RECORD
Do the free credit check you’re entitled to each year with each credit bureau. Fraud has soared during lockdown, and someone may have taken out credit in your name and be putting you in debt.



KEEP UP GOOD COVID-19 SPENDING HABITS
If we had to think of a positive to the pandemic, it’s that many of us have learnt we can live without things we once considered essential. Like frequent trips to the shops (costing petrol and money), pricey gym memberships (there are so many free classes online), and restaurant and ready-meals – we know we can cook healthily and affordably from scratch. Keep it up and relish the home companionship we’ve also learnt to appreciate.

FOR A FINANCIAL ADVISER:
Financial Planning Institute:
0861 000 374 (www.letsplan.co.za)

TO CHECK YOUR CREDIT RECORD:
Experian: www.experian.co.za
Transunion: www.transunion.co.za
XDS: www.xds.co.za

BY GLYNIS HORNING