Many people make new year’s resolutions to improve their lifestyles by establishing new goals for the coming year. However, few people accomplish their goals.
It is interesting that as many individuals as make these commitments, including getting in shape physically, so few consider getting their personal finances back in shape – even if doing so could be beneficial.
John Manyike, head of financial education at Old Mutual, stated, “As in previous years, multitudes of South Africans will enter 2023 with the knowledge that their finances would be difficult in January and the rest of the year, and will likely not improve.
“It is ironic that if we were disciplined and wrote down enduring financial resolutions, we could have our money in order for many years.
“Knowing how to preserve and develop your money is the key to overcoming poor financial practices and achieving financial stability. “Now is the time for change,” he remarked.
Manyike stated, “The better your performance, the brighter your future will be.”
According to Manyike, the following ten steps are required to enhance long-term financial health:
Knowing your debts – The process of achieving financial fitness cannot begin until you are aware of your debts. Listing loans, credit card debt, account balances, and other debts is the first step in determining the scope of the next work.
Stopping all unneeded spending and accounts – Once you have determined how much you owe, you should cease purchasing products you do not need.
Paying off debts – Pay off the debts with the highest interest rates first (some stores charge up to 21% interest on accounts). As these accounts are paid off, the funds used to settle them can be allocated to paying off obligations with a lower interest rate.
Debt consolidation – Consolidating debt into a single account simplifies payments. Additionally, as obligations are repaid and consolidated into a single obligation, interest expenses will decrease. This means that if you negotiate smaller settlement amounts, the size of your entire debt could be decreased as well.
Reducing your lifestyle footprint – Changing financial habits will necessitate making difficult choices. However, electing to keep your automobile for another year, lowering your restaurant visits, and cutting back on luxury purchases will yield instant rewards.
Considering bonuses in a new light – Any bonus or present you receive will be beneficial if it is used to pay off debt or initiate a savings plan.
More individuals are utilizing their expertise to generate secondary incomes.
Not panicking – Cancelling life and insurance policies or liquidating savings or investments could jeopardize your future stability.
To become a saver – Creating a new budget will allow additional money to be deposited into accounts. You will then have funds for emergencies as well as strategies for short-, medium-, and long-term saves.
Obtaining professional financial guidance – A personal financial consultant will assist you by analyzing your budget and implementing strategies to achieve your financial objectives.