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A Fin24 user says not letting debt get the better of you boil down to just one thing...
NOT letting debt get the better of you in my opinion boils down to one thing: knowing your financial boundaries/capabilities and then living within them, with the emphasis on within.
If you live on the boundary, you will never save and then one day when you do need to create debt, you will not easily be able to pay it back because all your money will already be allocated to something else.
Admittedly, maybe it’s easier for me, because I have two inherent abilities: the first to manage time and the second to manage money.
I have never needed a schedule to study, for example. I processed everything internally: how much I need to do and when I need to do it by. The same is true when it comes to money.
I met with my financial adviser a few weeks ago and he told me that I am currently saving 20% of my annual salary. According to him, none of his other clients are achieving this.
My thinking was (and remains) simple: When I joined the SABS and got a nice salary bump, I immediately allocated the maximum percentage I could to my pension so as not to get used to having more money.
In addition, I set up a pension scheme portfolio through Old Mutual.
Once the SABS and Old Mutual pension contributions were set up, I looked at what I had left of my salary. From there, I calculate what I can afford.
As far as possible, I always buy with cash, so I have never had a clothing account. When I looked at buying a car (I believe in always going second-hand), I calculated my budget and looked for something below my budget (I do have a monthly budget but never really keep to it).
That way, I have money for repairs and running costs and, of course, savings in general.
Another thing I am good at is making debt a priority. If I have some spare money at the end of the month, it goes straight into my credit card (the only debt I currently have).
I know from personal experience that others find my “method” of dealing with money tough. My girlfriend has asked me how I do it but she still goes out and buys shoes.
As mentioned, it is an inherent ability and one I think most people will battle to follow. But we can all try...
- Fin24
Add your voice on the Debt Issue:
*Ask our experts
*Share a personal story
*Write a guest post
NOT letting debt get the better of you in my opinion boils down to one thing: knowing your financial boundaries/capabilities and then living within them, with the emphasis on within.
If you live on the boundary, you will never save and then one day when you do need to create debt, you will not easily be able to pay it back because all your money will already be allocated to something else.
Admittedly, maybe it’s easier for me, because I have two inherent abilities: the first to manage time and the second to manage money.
I have never needed a schedule to study, for example. I processed everything internally: how much I need to do and when I need to do it by. The same is true when it comes to money.
I met with my financial adviser a few weeks ago and he told me that I am currently saving 20% of my annual salary. According to him, none of his other clients are achieving this.
My thinking was (and remains) simple: When I joined the SABS and got a nice salary bump, I immediately allocated the maximum percentage I could to my pension so as not to get used to having more money.
In addition, I set up a pension scheme portfolio through Old Mutual.
Once the SABS and Old Mutual pension contributions were set up, I looked at what I had left of my salary. From there, I calculate what I can afford.
As far as possible, I always buy with cash, so I have never had a clothing account. When I looked at buying a car (I believe in always going second-hand), I calculated my budget and looked for something below my budget (I do have a monthly budget but never really keep to it).
That way, I have money for repairs and running costs and, of course, savings in general.
Another thing I am good at is making debt a priority. If I have some spare money at the end of the month, it goes straight into my credit card (the only debt I currently have).
I know from personal experience that others find my “method” of dealing with money tough. My girlfriend has asked me how I do it but she still goes out and buys shoes.
As mentioned, it is an inherent ability and one I think most people will battle to follow. But we can all try...
- Fin24
Add your voice on the Debt Issue:
*Ask our experts
*Share a personal story
*Write a guest post
