Member Newsletter
Quarter 3 • 2023
Dear Member
In this newsletter, we share some valuable tips to help you take control of your spending. Improving your spending habits will change the way you spend money and help you save for your future.
Stay updated on the government's proposed two-pot system, expected to roll out in March next year. The two-pot system will allow you to access a portion of your retirement savings while working. We also highlight the importance of saving for retirement by making saving a priority. Saving a small amount consistently over many years will eventually grow to a substantial sum. Financial independence is crucial to retiring comfortably.
In this newsletter we explain why it is important to set your sights on the long term when looking at the investment performance of your retirement savings.
TAKE CONTROL OF YOUR SPENDING
INFLATION AND HIGHER FUEL PRICES HAVE PUT PEOPLE UNDER FINANCIAL PRESSURE. THIS CAN EAT INTO YOUR SAVINGS AND LEAVE YOU WITH LESS MONEY FOR YOUR FUTURE.
IT'S ALWAYS GOOD TO IMPROVE ON YOUR SPENDING HABITS. HERE ARE SOME TIPS TO HELP YOU SPEND LESS.
1
Track your spending
At the end of every month, go through each item on your bank statement. Note how much you spend and what you spend it on. You can also keep a spending diary. Carry this around with you and note your spending. After a while, you will be able to see exactly where you can make savings. Spending wisely could mean something as simple as ordering fewer take-aways and cooking at home instead.
2
Pay off your debts
If you are making only the minimum payments on your debt or your credit cards, try to pay more each month. Consider setting up an automatic monthly payment towards your debts.
3
Use waiting periods
When you are about to make a big purchase, give yourself a waiting period (at least 24 hours) before actually purchasing the item. This will prevent you from making any impulse purchases and buying things you don't actually need.
4
Cut your luxury spending
If you tend to splash out on unnecessary luxuries – such as jewellery, sporting equipment or frequent holidays, think twice.
Cut your spending on those items and redirect that money into your savings or pay off your debts.
5
Preserve your retirement savings when changing jobs
The purpose of your retirement savings is to provide for you and your family once you retire. The longer you save, the more money you will have. Cashing out when you change jobs can put your financial future at risk.
6
Try a spending fast
Take a month, or several months, or even a year – and commit to buying nothing but the essentials. If you don’t need it, you don’t buy it. This will most likely mean less eating out, less spending on books and entertainment, and no new clothes (unless they are absolutely needed). This may also help you to reset your sense of what is and what is not actually necessary.
7
Set goals
Set yourself specific goals that are achievable and that you can measure. Write them down and add dates. An example is 'pay off my account at a particular store', or 'save the equivalent of three months' salary as an emergency fund'. If you set specific goals, you are more likely to achieve them.
8
Shop with a list
Have you ever gone shopping to buy a specific item but ended up purchasing other items? When you go shopping without a list, it is easy to buy things impulsively. Impulse purchases can hurt your wallet and your wealth-building efforts. They can also put you in debt. Shopping lists prevent impulse buying, stop overspending and help you to prioritise on buying only what you really need.
9
Save every month
Saving and preserving your money is critical to your future. The most important step that you can take is to start saving. There will be months when you have little to save, but don't be discouraged. Save as much as you can, as often as you can. Once you establish the habit of saving, it will get easier and easier.
10
Consult a financial adviser
If you don't know how or where to start, then speak to a qualified financial adviser.
They can give you advice and support. They will help you to manage your money, map out a plan for your future and prepare you financially for your retirement.