Everyday, we are confronted by hundreds, if not thousands, of things we can buy. This kind of temptation can lead to us neglecting important aspects of our financial lives. As a result our budgets go out the window, we run short of money before the end of the month, or at worst we end up in debt.
There are two ways to get out of debt and free up cash, you can either earn more money or spend less. Finding a new job with a better salary is not always achievable, but spending less is definitely an option for everyone.
So while the situation may seem bleak, it can be fixed. Many of us spend money on things we don’t need, so Nitesh Patel, Head of Customer Financial Solutions at Standard Bank, has suggested some things to consider cutting out or changing. Some may induce a ‘no way’ response, but as long as you can find a few items to cut, you will be able to access some extra cash in your monthly budget.
Books
We are ALL for reading, but there are ways to spend less on books. Instead of buying your own hard copy, borrow from your local library or a friend. Visit market book stalls or second-hand shops and get them at a better price. There are also plenty of free and inexpensive ebooks available online. If you are happy to wait until the hype dies down on popular books, they will eventually become discounted.
TV Subscriptions
If you feel that your finances are in disarray, cut out expensive TV services. These can cost upwards of R500 per month, money that could be better spent paying off debt or building up a retirement fund, for example.
Water
Opt for tap water instead of buying bottled water; it is perfectly safe. For a little luxury, invest in a cooler with a filter or buy a filter jug.
Texts and long-distance phone calls
Avoid paying for texts and long-distance phone calls by downloading one of the many ‘free’ messaging apps, like WhatsApp. Be careful however that you do not consume excessive data on these applications as out of bundle data charges are very expensive.
Gym contracts
Many people subscribe to services they end up not using, and gym contracts are the biggest offenders. Be honest with yourself; don’t keep the contract if you know you are not going to use it.
Electronics
If they are a necessity, you don’t need to break the bank on the latest and best. A R200 kettle will work just as well as the one that cost R500, and will probably last just as long.
Cars
Buying a new car every two years will subject you to a never-ending spiral of debt. You will never have the title in your hands if you keep trading in your car for the current year’s model. Keep your car until it is paid off. Then, if you trade it in, you will have some equity to put towards the new vehicle. By doing this, you will lower both your payments and interest charges.
Fix your fashion addiction
There are so many reasonably priced clothing stores available to us now, there is no need to spend R1 500 on a pair of jeans, for instance. You can still look great on a budget if you shop smart and look for sales. If you routinely buy designer clothes at full price, you could be paying 200% more for a label. This is not wise if your retirement savings are looking slim and you have to use credit to keep up appearances.
Jewellery
Jewellery is lovely to have, but it is not always a good investment. The second-hand market for jewellery is not very robust (unless it is antique) and it is generally considered a non-performing asset. It also costs money to insure, so any growth in the metal value may be offset by insurance costs.
Food
The vast majority of food in supermarkets is processed convenience food, and some of the food are generally not healthy or economical. Rethink the way you shop and forgo pre-cooked ready meals or cut vegetables. While they may save you time, they will hit your wallet.
Subscriptions you don’t use
Some subscriptions automatically renew every year, causing yet another expense that you don’t want or need. If a service has stopped being useful, cancel it.
Looking for more money tips? Here’s the broke girl’s guide to saving money, and 3 money saving hacks you need to know!
