According to a recent financial wellness survey by short-term lender, Wonga, 52% of South Africans claimed that financial constraints hold them back from saving money or paying off their debts. For many, this has a significant impact on their mental health.
Feeling stressed and anxious can make it more challenging to manage finances. It can lead to impulsive behaviour where money is spent on things that are not necessarily needed. Other behaviours include avoiding calls due to accounts being in arrears or not monitoring statements regularly.
“It is important for people to live within their means in order to manage their expenses efficiently,” says James Williams, Head of Marketing at Wonga. “This limits additional stress when unforeseen circumstances such as increased interest rate hikes or inflation occurs.”
Williams shares top tips on how to tackle money worries and protect mental wellbeing:
Use a budgeting app like 22seven, which shows you your income and all of the things you spend it on. This app supports more than 120 South African financial institutions and is available for Android and iOS users.
Pay off your credit card debt with any extra income that you may earn, such as a salary bonus or a side hustle.
Online shopping websites often remember card details to make it easier for you to buy things when you revisit them. Make sure you clear your cookies to avoid purchasing things that you don’t need.
Talk to your creditors and find out if you can adjust your daily spending limits. You also have the option to temporarily freeze your account until you regain control of your spending habits.
Do not ignore the companies you owe money to. Communicate with them to limit negative judgements on your credit profile, which might affect you when you need to finance important things like a property or a vehicle in the future.
If you have made a purchase and later realise it is not something you need or you cannot afford it, return the item to get your money back. Online stores like Takealot have an option where you can log a return within seven days of purchase.
Build an emergency fund by opening an interest-bearing savings account. Look at savings accounts that reward you with points that you can spend in store, such as Standard Bank Ucount rewards or Discovery Bank Discovery miles and ebucks with First National Bank
Poor mental wellbeing can affect how people manage their money, so it is important to practice financial self-care by taking the time to understand how money works. This can be achieved through improving financial literacy, which will help you make well-informed decisions about your money.
“Financial service providers have a major role in equipping customers with knowledge of how best to manage their finances,” says Williams. “We encourage people to be honest about their financial standing and to set healthy goals for themselves,” he concludes.
Visit the Wonga Money Academy for tips on how to learn more about how to better understand the basics of financial management: www.moneyacademy.co.za
