Tips on staying financially afloat during tough times

By Alana Bolligelo_ - 13 November 2018Views : 2225

With the economy struggling the way it is, many families are struggling to keep their heads above water.

Chief executive officer of FNB Easy, Pieter Woodhatch, has one important tip for families: budget.

"Families should make every effort to track what every cent is spent on, not an easy task but it can be accomplished," he says.

"The first step is creating a budget and sticking to it as a family, some families may be already stretched but they too must maintain financial discipline. A budget is a good way of identifying where your money goes, but most importantly, it also helps identify wastage and unnecessary expenses. The sooner you spot and close leakages in your family kitty, the better your financial position will be over the long-term," he advises.

Although it can be difficult, he says that sticking to a budget is necessary but needs the whole family buying into it in order for it to succeed as some sacrifices may be required.

A few areas to think about:

1. Unplanned expenses
Woodhatch advises that you put away something for a rainy day, even if it's just R100 a month.

"The best way to remain consistent with your savings is by having debit order transfer with a set amount on a monthly basis. In this way, you are able to plan around the money you are left with after saving and committing monthly expenses," he advises.

2. Education expenses
He advises parents to buy school supplies ahead of time, before the regular "back-to-school" madness starts. He says things tend to be less pricey when there isn't all the hype around. Using a lay-by facility for school clothes can also help ease the burden on what can usually be a costly expense.

3. Don't cut off funeral insurance
Woodhatch advises not to cut insurance from your budget, but rather entertainment.

"A funeral insurance will buffer you from having to borrow in the unfortunate event of a death in the family," he advises.

"The only thing that will push a family towards financial prudence is consistency, and in this instance what counts is having a budget and sticking to it," Woodhatch urges.