What a crazy start of the year it has been! Last year ended with the firing, hiring, firing and rehiring of finance ministers, and a resulting re-rating of the South African economy by the credit agencies. This year started with the Rand depreciating from terrible to dismal as the Japanese sold their South African bonds in favour of US bonds. It is a sad state of affairs! But I try not to look at the value of the Rand, and rather focus on the few things I can influence—the one being personal financial planning. This year I want to focus on your personal finance planning as I take you on a Wealth Management Course.
As I said at the end of last year, you will receive two emails per month focussing on your wealth management—one at the start of the month, explaining the focus of the month, and another going into more detail. The aim is for you to spend less and save more. I heard many of my clients complain last year that, as expenses rise each month, they have less and less to save. They also complained that they do not know where their money goes each month. It is true that goods and services increase because of inflation, but I want to make sure that each Rand you spend is spent in the best possible way. I will give you an example: By revisiting a client’s short- and long-term insurance cover, we could save on her short-term insurance premium by shopping around and finding another insurer. As a result of the saving, we could increase her long-term insurance (i.e. life, disability and severe illness cover) with cover that is in line with her needs. Her total spend on her insurance (both short- and long-term) remained the same but her Rand spent was now in line with her financial and family needs. Or: Another client changed her shopping habits from buying every second day to only buying weekly. By planning her meals and grocery shop she was able to save 10% on her grocery bill. That 10% is now being saved in a long-term education plan for her children’s tertiary education.
As with everything in life, unless you put in the effort and do the steps, you will have little value from the course. If you, however, do the steps each month, you will be saving more and spending in line with your personal goals. So let’s journey together this year and control the one thing we do have control over—our personal spending of our money.
P.S. Now is not the time to take money offshore. If you have money offshore, great but, if not, let’s rather wait for the Rand to recover somewhat. Otherwise we are doing the typical herd mentality of buying high and selling low. Let’s wait for the Rand to recover to more acceptable levels before we go offshore.
Another aspect I want to look at this year is your Vitality status if you are a Discovery member. Unless you are on silver, gold or diamond, Discovery can be very expensive and you will not enjoy the benefits that it does have to offer. If you are a Vitality member you would have received an email about Vitality in conjunction to this blog. If not, please let me know soonest so I can include you on the list. The blogs, if followed, will get you to gold before the end of the year. So please read and follow the blogs on Vitality and let’s get to gold!
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