MyMoney Online

Damage Control for January Blues

It’s that time of year when we have turned the corner into the new year and need to get our finances back in order as soon as possible.

Here are 3 “Don’ts” which will help you to get you off to a quick and effective start mindful that its always better to put up your sails before a storm than during one.

1 – Don’t ignore the damage

Get down to the details quickly and formulate an action plan for the new year. Work out the damage before the statements arrive at the end of the month. The earlier you start the more prepared you will be before your next salary.

You are going to need to sacrifice somewhere to make up for the over indulgences of the festive season. You will find them by creating a detailed budget and splitting your expenses into “must haves” and “nice to haves”. The area of “nice to haves” will need to be scrutinised ruthlessly and there you will find the extra cash to pay off the debt. Target the credit card first as this is probably the most expensive debt.

You need to allocate towards interest and the amount owing. You should try to payoff as much of the principal debt as possible.

2 – Don’t borrow anymore

Don’t borrow more to get out of debt. It’s like trying to fill up a bath with the plug out. Put the plug in by shelving your credit card for a while and turn up the taps by squeezing out extra cash from your expenses.

Obviously this will also mean that no more “nice to have” spending for a while. You can review this only once you are back one your feet.

3 – Don’t dip into your savings and investments as a quick fix

Work out how much you can allocate over time to getting rid of your debt. Stick with the program until you are out of the water. Set a realistic time frame realising that debt robs you of potential savings. The sooner its behind you the more you will have to compound and create wealth for your financial freedom into the future.

Ideally, you should save towards a contingency fund during this year to ensure that you don’t fall into the same trap of “catch up” in 2017. A great challenge for the new year…whereby you will have cash for the next festive season and avoid the stresses of the next years January Blues…..

Listen to Paul Roelofse below...

Read more from Paul Roelofse at www.investforlife.co.za

702 welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

  • Racism (including offensive comments based on ethnicity and nationality)
  • Sexism
  • Homophobia
  • Religious intolerance
  • Cyber bullying
  • Hate speech
  • Derogatory language
  • Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the 702 community a safe and welcoming space for all.

702 reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

702 is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

Read More
Where to invest money you intend to leave to your kids

Where to invest money you intend to leave to your kids

The Money Show’s Bruce Whitfield interviews Galileo Capital Personal Financial Advisor Warren Ingram.

How to survive retrenchment

How to survive retrenchment

Your rights (and their responsibilities) upon retrenchment. Bruce Whitfield interviews Personal Financial Advisor Warren Ingram.

3 shares that'll bring home the bacon

3 shares that'll bring home the bacon

The Money Show’s Bruce Whitfield interviews Overberg Asset Management analyst Kirk Swart.

The best investment on the JSE right now and one from abroad (by Anchor Capital)

The best investment on the JSE right now and one from abroad (by Anchor Capital)

Bruce Whitfield interviews Anchor Capital Aggressive Long Short Fund Portfolio Manager Liam Hechter for his “stock picks” feature.

You’re wrong if you think you (or anybody else) can time the market

You’re wrong if you think you (or anybody else) can time the market

Don’t even try, because inflation will eat you for lunch, says personal financial advisor Warren Ingram.

3 best companies to invest in right now (by Nefg Fund Managers)

3 best companies to invest in right now (by Nefg Fund Managers)

The Money Show’s Bruce Whitfield interviews Nefg Fund Managers Chief Investment Officer Gerbrand Smit.

Popular articles
Why the PAC wants South Africa renamed Azania

Why the PAC wants South Africa renamed Azania

Pan Africanist Congress's Narius Moloto explains why it supports the name Azania, a word which he says has Arabic origins.

Opinion:  Bishop Lekganyane is right

Opinion: Bishop Lekganyane is right

Stephen Grootes weighs in on comments made by the Zion Christian Church Bishop at the weekend.

Getting to know MP, Dr Makhosi Khoza

Getting to know MP, Dr Makhosi Khoza

Dr Khoza is admired by South Africans for her role in the SABC inquiry as a ANC member of parliament.

Who is Advocate Tembeka Ngcukaitobi?

Who is Advocate Tembeka Ngcukaitobi?

The EFF lawyer stole the show during the state capture report court battle.

How to make your first million

How to make your first million

Warren Ingram discusses his new book in which he shares practical ways for ordinary people to achieve financial freedom.

Meet the founder of Capitec Bank, named ‘Best Bank on Earth and Cheapest in SA’

Meet the founder of Capitec Bank, named ‘Best Bank on Earth and Cheapest in SA’

Michiel le Roux speaks about the fascinating story behind the little bank that has the Big 4 shaking in their boots.

3 easy questions could bag you R2000!

3 easy questions could bag you R2000!

WIN R2000! But only if you can prove you're a whiz of the MTN Biz Quiz by answering the following three questions...

Blesserfinder: Matching you with a sugar daddy near you

Blesserfinder: Matching you with a sugar daddy near you

Is social trend Blesserfinder, where girls are allegedly matching up with rich 'benefactors' in exchange for sex, a real thing?