Bank Better, Live Better
common money mistakes to avoid01/05/2017
With so much going on in our lives, it’s easy to make these common money mistakes daily. Avoid making them to save time and money.
Not having a lifelong financial plan
A plan for life will give you specific financial life goals to work towards, help you avoid financial frustration and prepare you for unexpected life events. It will also influence how you manage your money daily.
Avoid this mistake: Follow these 6 steps and start building your plan for life.
Not having a budget
Avoid this mistake: Download our app and use the new budget tool to plan and manage your budget on the go.
Not paying the best bank fees
Some banks offer bundled options where you pay one fee for a set number of transactions per month, which you could end up not using. You may also find yourself paying more for additional administration or management fees.
Using expensive banking channels
Avoid this mistake: Use your cellphone, app or the Internet to make payments instead. You can also swipe your Global One card and pay zero transaction fees.
Paying late fees
If you don’t pay your bills on time you’ll pay extra late charges because of higher interest on the outstanding amount. It can also have a negative effect on your credit profile.
Avoid this mistake: Know when to pay your bills. Set reminders for yourself. Even better, use debit orders and never worry about making manual payments again.
Wasting money on a bad habit
Eating out too much? Spending on luxuries you don’t really need? It may not seem like much at first, but small costs add up pretty quickly. That’s money you could be saving.
Not saving enough
Last year, in a poll, 77% of you said you had no savings. Having a savings plan in place that takes irregular expenses into account will protect you from taking on unnecessary debt when sudden, unexpected financial events happen.
Avoid this mistake: Use smart ways to save to build your savings pile.
Not being credit wise
Using credit wisely means your credit profile is protected and in good shape. Too much debt can ruin your cash flow and you could end up borrowing even more money.
Avoid this mistake: Download our free ebook for ideas to help you use credit wisely.
Not checking your credit profile
All South Africans who have credit have a credit profile. You can request one free credit report per year from a credit bureau. Not only do you see what your credit status is and whether all the information is correct, you can also spot any suspicious credit purchases in your name.
Not planning for irregular expenses
Most people have a plan for regular monthly expenses such as home loan or vehicle repayments but it’s just as important to plan for less regular yearly expenses such as home repairs and maintenance, car services and repairs, birthdays and anniversaries, back-to-school costs and holidays.
If you haven’t planned for them you could end up spending money you were saving for something else or taking credit you can’t afford.
Avoid this mistake: Avoid nasty financial surprises. Plan for irregular expenses.
Having no emergency fund
An emergency fund will help protect you should you lose your job, face an unexpected repair cost to your home or vehicle, have to pay a major health expense or for a funeral. Not having one means you could end up taking too much credit, affecting your cash flow and credit profile.
Avoid this mistake: Open your savings account today and earn interest from the first rand. Aim to save the equivalent of 2 – 3 times your salary.
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