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Learning to Save – A Life-Saving Lesson

As we navigate through life, changing interest rates, and tough economic times, it's crucial to ensure our financial well-being and build a strong foundation for the future. No matter what your income level is, saving money is an essential skill that empowers us to achieve our dreams and ambitions.

So, let's dive into some practical and effective ways to start saving, whether it's large or small amounts, each month.

1. Set clear goals: Begin your savings journey by setting specific and achievable financial goals. Whether it's saving for an emergency fund, a dream vacation, or investing in your future, having a clear target will motivate you to stay on track. Sanlam’s Financial Check Tool can help you map out where you currently are in your financial journey.

2. Create a budget: Take a close look at your income and expenses. Creating a monthly budget helps you understand where your money is going and identify areas where you can cut back. Allocate a portion of your income to your savings as a non-negotiable expense.

3. Start small but be consistent: If saving large amounts feels overwhelming, start with small, regular contributions. Automate your savings by setting up a direct debit into a separate savings account. Even saving a small percentage of your income each month will add up over time.

4. Embrace the 50/30/20 Rule: A popular budgeting rule; allocate 50% of your income to necessities (like rent and groceries), 30% to wants (like entertainment and dining out), and 20% to savings and debt repayment. This balanced approach ensures you enjoy life while building financial security.

5. Cut unnecessary expenses: Review your spending habits and identify areas where you can make cutbacks. Limit eating out, coffee runs, or impulse purchases. Redirect these funds into your savings account.

“Review your spending habits and identify areas where you can make cutbacks. Limit eating out, coffee runs, or impulse purchases. Redirect these funds into your savings account.”

6. Take advantage of discounts and rewards: Look out for special deals, discounts, and loyalty programmes offered by local businesses. Saving on everyday expenses leaves more room for growing your savings. Have a look at the savings Sanlam Reality has to offer for entertainment, travel and lifestyle.

7. Side hustles for extra income: In the gig economy, there are plenty of opportunities to earn extra income. Consider freelancing, tutoring, or selling handmade crafts. The additional cash can significantly boost your savings.

8. Avoid debt traps: High-interest debts can hinder your ability to save. Understand where you stand when it comes to your credit score and current debt through our Sanlam Credit Solutions dashboard, and take it from there.

9. Invest wisely: Once you have a comfortable emergency fund, explore low-risk investment options. Speak to a financial adviser who can guide you on investments that align with your financial goals.

10. Celebrate milestones: Saving money doesn't mean depriving yourself of joy. Celebrate your savings milestones to stay motivated. Treat yourself occasionally but remember to stay within your budget!

Remember, saving money is a journey, not a race. The small steps you take towards your savings goals today can make a big difference in the future. Start where you can, and gradually increase your savings as your income grows. Building financial security gives you the freedom and confidence to pursue your passions and live life on your terms.

Remember to consult with a financial adviser before making decisions that impact your savings and investment strategies.

 

 

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