DO YOU KNOW WHAT NO-ONE EVER TELLS YOU?
Here’s one secret that most people will never share with you: they’re not saving! That’s the saving secret. When you’re out having coffee with your girlfriends, they’re not about to tell you how much debt they’re in and that they don’t have any savings. When you’re enjoying a good braai after the rugby, chances are your conversation will not focus on finances.
For the most part, people who are in debt have been trained to think that they need to clear their debt before they can start saving.
The problem with this approach is that there will always be ‘un-budgeted expenses’ that arise, and if you don’t have a buffer savings account, you’ll just use your credit card or take a personal loan to cover it – which puts you into even more debt.
SOME SOUTH AFRICAN DEBT STATS
We recently read that the household-debt-to-income ratio is around 75-80%. This means that some of your friends (and possibly you) could be paying up to R80 of every R100 that they earn to pay back their current debt, leaving only R20 left to pay for their monthly expenses.
So what’s my secret to clearing your debt? Start saving, but start saving small. Don’t wait until you’ve cleared your debt and make sure you have a plan.
PLAN TO SAVE
There is an old Chinese proverb that says:
“It is better to take many small steps in the right direction than to
make a great leap forward only to stumble backward.”
This is exactly the approach that you need to take with saving. You start by telling yourself that it’s okay to be in the position that you’re in; whether you have nothing saved or whether you’ve got a lump sum stashed away and you want to start adding to it.
Once your mind is right, you begin small. Literally! Even if it’s R10 a week – you start! You can put it in a jar in your cupboard or open a low cost account with Capitec, as soon as you see that amount going up every week, you will begin to feel empowered in your relationship with you money – and that’s a fantastic start!
Most people don’t plan their saving for two reasons: either they think they can’t afford to save or they feel that they need to clear their debt first.
Planning to save is essential to sustaining your saving. So if you plan to save R10 a week – write it down. In my Abundance Diary, I have a daily savings space for you to write down what you were able to save. This helps you plan and it keeps you encouraged to keep going! Track your spending and your saving with my diary and stick to you plan.