By: Sean van Zyl
In the thrilling aftermath of the Springboks’ recent one-point victory over New Zealand in the Rugby World Cup, an exciting connection emerges between the world of sports and personal finance.
This win, achieved by the smallest of margins, reminds us that success often depends on seemingly minor victories.
Just as a single point in three-consecutive matches can secure a Rugby World Cup, repeated actions that result in small wins can significantly impact your financial well-being. Think of a massive ship: its direction is determined by a tiny rudder. Similarly, our financial futures can be influenced by our small daily decisions.
In the spirit of the Springboks’ 12:11 final victory, Old Mutual Personal Finance offers 12 tips on minor improvements in your financial journey. How can you put these into practice?
Some minor adjustments that can lead to significant financial growth:
Detail All Expenses: Beyond your monthly debits, account for all anticipated expenses, such as car maintenance or annual gifts. Spreading one-off costs over months ensures you’re financially prepared when they arise.
Periodic Expense Review and Limiting Luxuries: Simple daily habits, like a chocolate from the petrol station or that takeaway coffee, can accumulate substantial costs over time. It’s prudent to periodically review and identify the subtle overspends. Consider limiting daily luxuries, such as reducing your coffee purchases to twice a week, allowing small savings to steadily accumulate.
Research: Taking a few minutes to research can provide valuable insights into where and how you can save.
Explore Affordable Alternatives: Often, there are more cost-effective options available that don’t compromise on quality. Switching to these can lead to significant savings over time.
Small Investments Matter: Setting aside just R10 a day can lead to a monthly investment of R300. Over time, the small amounts compound into considerable savings.
Review Financial Services: Whether it’s tweaking your bank package or adjusting insurance premiums, periodic reviews can ensure you’re paying only for what you need.
Use Budgeting Platforms: Tools like trusted budgeting app 22seven can provide a clear overview of your spending, helping you spot patterns and make informed decisions.
Monetise Unused Items: The proverbial yard sale can declutter your space and add to your savings.
Hobbies to Earnings: Your passions could be an avenue for additional income, even if it’s just over the weekends.
Emergency Fund: Having rainy-day savings ensures that unplanned expenses don’t derail your financial journey.
Smart Debt Management: Overpayments on high-interest debts can save you significantly in the long run.
Educate Yourself Continuously: Stay updated on financial news and trends. Knowledge can open doors to new saving or investment opportunities.
Consider this: Saving a mere R10 a day and adding it to a monthly mortgage repayment could save a staggering R185 090 over a 20-year term on an R1 million bond at 11.75% annual interest.
While the allure of grand gestures can be tempting, the power of persistent, minor moves often makes the most significant impact. Just as the Springboks' slim victory margin made all the difference on the pitch, in the financial game, too, every point counts.
At the heart of these tips lies a consistent message of financial wellness.
It’s about empowering our customers with the necessary knowledge and tools, then acting as partners on their journey. At Old Mutual Personal Finance, our advisers are committed to guiding customers towards making those small, pivotal decisions today that will reap significant rewards tomorrow.
* Sean van Zyl, is a financial planner with Old Mutual Personal Finance.
PERSONAL FINANCE