CAPE TOWN- Many non-essential service employees or business owners have a lot more time on their hands during the 21-day nation-wide lockdown.
Commercial manager of personal finance website Justmoney, Sarah Nicholson says that there are benefits to tidying up your finances.
Decluttering is believed to give you a fresh perspective, make you feel lighter and more motivated, and even enhance your decision-making and well-being.
“In the same way that having a clutter-free, organised home can be liberating, a debt-free and organised financial life can be very freeing indeed. You will feel more in control of your spending and can allocate your hard-earned cash to what is really important for you.”
Nicholson and Justmoney offer 10 tips to get you started:
1. Clean up
Piles of statements stuffed into drawers, and guarantees going mouldy in the garage, will only raise your blood pressure. Allocate time to sort through grungy folders and records. Shred what you don’t need to avoid identify theft.
2. Get sorted
Locate and safely store important documents such as birth and marriage certificates, passports, and car registration certificates. Taxpayers must also keep records and supporting documents for five years from the date on which SARS received the tax assessment for that year.
3. Go paperless
Electronic statements reduce the amount of paper you have to process or shred, and are better for the environment. Set up folders on your device so that you can easily locate mail.
4. Stick to a system
Some people have the time to do a daily check on bills and balances, many find it more realistic to process a batch of paperwork in one go, say once a week. The important thing is to stick to a system that works for you. Log into your bank account to check balances, pay your bills, and generally keep track to help avoid potential problems. Consider automating some payments.
5. Check where your money goes
Download a money app or write down what you spend in a notebook. This way you can’t evade the evidence. Does a large amount go on eating out and bookings on ride-sharing apps? Dig deep and get to the root of your spending habits.
6. Come clean
Sitting down with your significant other or holding a family meeting to talk about finances can lead to agreement on priorities and cost-cutting.
7. Decide what you really need
Check what policies and investments you hold and whether these still suit your circumstances. You could be paying too much for car insurance, and too little on life insurance, for example.
8. Trim the excess
Do you really need four credit cards, a gym membership you never use, and investments with a range of service providers? Reducing these numbers can give you a clearer idea of where your money goes and will cut the amount of mail you receive.
9. Budget better
Determining what is really important to you will encourage you not to fritter away money. There are budget calculators available on the internet.
10. Keep up the momentum
“Decluttering and organising must be ongoing, but the payoffs are well worth it,” says Nicholson. “Break up a big job into a series of small tasks, and you will remain ahead of the game.