Is your money working as hard as you are?

Workers’ Day is a time to contemplate the contribution we all make to the economy and perhaps to take stock of where our careers are heading. It is also a perfect opportunity to assess whether our hard-earned money is working as hard as we are.


Protect your most important asset

Your ability to earn an income is your most valuable asset. You work hard to hone your skills, expand your abilities and choose the right moves to make, but what if you lose your ability to work through accident or disease? What happens then?

Too many people still overlook this part of their financial planning, because no-one thinks anything bad will happen to them. Some form of income protection is absolutely crucial to ensure that you can absorb a temporary or permanent loss of income.

Dread diseases like cancer and heart disease are unfortunately on the rise in South Africa, but thanks to modern medicine and early detection, the chances of survival are also quite high. Having dread disease and income protection in place can help ensure that you won’t have to face astronomic bills and financial woes when you recover, and that you can resume work without a heavy debt burden.


Crunch the numbers

The importance of a budget, and sticking to it, cannot be emphasised enough. Keeping close tabs on how much you spend and what you spend it on, is the first step in taking control of your finances. Assessing your spending can help you cut out unnecessary expenses and assist in freeing up some cash in your budget. The next step would be to choose a savings vehicle that suits your lifestyle and your long- and short-term savings goals. Consulting a financial planner can help you find the right fit.


Be careful who you trust with your money

The old saying “If it sounds too good to be true, it probably is” still rings true. It would seem that around every corner people and organisations are offering ludicrous returns. Unscrupulous “businesses” are very adept at luring unsuspecting would-be investors into parting with their hard-earned cash. Financial pressures and rising fuel and food prices unfortunately make these offers seem very tempting. Make sure you invest your money with a reliable and established company with a solid history and reputation. Do your research and don’t be afraid to ask questions. You’ll save yourself endless grief in the long run.


Make sure you reap the rewards in retirement

Planning a comfortable retirement is every bit as important as making the right career moves. Few things are more depressing than devoting 30 years plus to working and then having to scrape by in retirement. Making the right choices now, and starting as early as possible, can help ensure that you enjoy the retirement you deserve. Retirement savings are dependent as much on your ability to be patient and to leave your nest egg alone, as on the contributions you make every month. Do not be tempted to take your retirement savings as a cash payout when you change jobs. Doing so will mean that you have to start all over again, and have a shorter period to save.

Just as you build your career, financial wellbeing is a long-term commitment, but with the right guidance, discipline and savvy decision-making, you may achieve it sooner than you think.

Related Content

Using a trust to protect your business


You’ve heard about family trusts used to protect personal assets, especially those of minor children. But did you know that a trust can also...

Full Article

Your business is not your retirement plan


Business owners and entrepreneurs need to make provision for their personal financial security, as well as looking after their business.

Full Article

Earn bucks for your beds


Holiday home? Airbnb? Buy-to-let? A second or even third property can boost your income and increase your assets if you do it right.

Full Article

Five great money moves for women


Women in certain parts of the world may reach a life expectancy of 90 years in just over a decade from now. This staggering...

Full Article

Three steps to a moneywise child


Parents have the power to equip their children with the tools they need to be financially savvy. But it’s vital to start from a...

Full Article

Tax-free savings accounts for every life stage


Karin Muller, head of growth market solutions at Sanlam Personal Finance, explains how tax-free savings accounts can be used to your best advantage at...

Full Article

What are unit trusts?


Unit trusts are a popular choice for investors who want access to blue chip shares and bonds, which are not cost-effectively available to direct...

Full Article

Know your consumer rights


That phrase ‘let the buyer beware’ no longer has such sharp teeth since the Consumer Protection Act came into force. This legislation gives you...

Full Article

Women and divorce: the financial implications


It is said that nearly half of all marriages in South Africa end in divorce. Unfortunately divorce usually goes hand in hand with great...

Full Article