Nine New Year's resolutions for a wealthier 2021

The beginning of a new year is always a good time to reflect, take stock, and set goals for the year ahead. After all the challenges that came with 2020, now is probably a good time to make sure that you add some financial resolutions to your list. And in case you’re not sure where to start, hopefully these suggestions will help make 2021 a better financial year for you.  

1. Save more
One of the silver linings of 2020 is that it showed most of us some areas where we can save. Many people working from home may have missed their daily cappuccinos – but at R25 a day, they’ve probably also saved over R5 000 last year on coffees alone! There are many other examples where you can save small amounts of money each month, and investing these savings instead can help you achieve your bigger financial goals.

2. Start investing
If you haven’t yet taken the plunge to enter the world of investing, now is the time. Starting a new investment has never been as affordable and easy.

3. Set up an emergency fund
An emergency fund is a savings fund specifically set aside for unexpected events. The standard advice is to have enough saved up to cover 3 - 6 months’ salary, and the objective is to be able to cover unexpected expenses without having to take on debt. 

4. Pay off your debt
Debt is one of the biggest obstacles to financial freedom. Setting – and sticking to – a resolution to pay off as much debt as possible this year is one of the best decisions you can make. A good tip is to start with paying off the debt that has the highest interest rate and go from there.

5. Avoid taking on new debt
If you can’t afford it outright, ask yourself the question: “Do you really need it?” If it’s more of a want than a need, consider setting some money aside each month until you’ve saved up enough to make that purchase.

6. Pay your bills on time
Avoid paying extra interest costs on your phone, rates and utility bills by paying them on time each month. Set up a debit order if you haven’t yet already, so that this isn’t something you need to worry about each month

Read the full article: https://www.prudential.co.za/insights/articlesreleases/nine-new-year-s-resolutions-for-a-wealthier-2021/ 

December 29 2020 By prudential.co.za Financial planning