MyMoney Online

How to save before the festive season

Financial planning is all about making provisions for expected and unexpected events into the future. The nearest expected event on our calendar is the festive season which is just around the corner.

If you haven’t been saving for this costly event during the year then you have 4 pay cheques to go to create a nest egg to help you through.

Savings needs to be easily available and safe from the risk of losing any capital. Certain investments such as shares, property and bonds need more time and therefore should not be considered.

Here are 3 ideal places to stash your cash:

Access bond: My favourite for the short term as the money is easily available and effectively earns the rate of interest that you pay on the bond. You should save as much as possible here allowing you easy access to your extra cash over the festive season. You can access it at any time as and when you need money over the holidays and there is no risk at all.

Credit Card: Now is the time to make a move and pay off the credit card bringing it into a positive balance. You will do better with the extra money in the access bond as the interest earned on credit balances on the card are lower (around 4%). The big advantage is that when you get to the festive season you won’t have a noose around you neck charging you an interest of 24%.

Money market account: This investment is normally better than the different savings account on offer by the banks. It generally offers higher interest and is more accessible which is what we are aiming for by December.

You should open up a money market account with your bank and then manage it next to your current account on your internet banking profile. For the next 4 pay days, when you get you salary, keep as much of your money in the money market account during the month and as little as possible in your current account. Transfer from the money market account the current account as and when you need to. Effectively earning some interest instead of nothing in a current account.

You can take charge of your financial needs by planning for them. If you saved even a little over the next few months, your festive season will be that much better than having nothing at all and having to make the fatal mistake of borrowing to get through.

Listen to the audio below for more information...

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


Recommended

by NEWSROOM AI
Read More
Hottest JSE-listed shares to buy, right now (by Arqaam Capital)

Hottest JSE-listed shares to buy, right now (by Arqaam Capital)

The Money Show’s Bruce Whitfield asks portfolio manager Ashraf Mohamed what he is buying right now.

What it'll cost to educate your kid abroad (and how much you must save a month)

What it'll cost to educate your kid abroad (and how much you must save a month)

Bruce Whitfield asks Galileo Capital Financial Advisor Warren Ingram about the cost of educating a child overseas.

Game over, Tencent (i.e. Naspers)? No, it remains a profoundly good longterm buy

Game over, Tencent (i.e. Naspers)? No, it remains a profoundly good longterm buy

It’s not the beginning of the end of Tencent, says portfolio manager Francois Strydom, despite it losing R3.2 trillion in value.

How Tito Mboweni will impact your retirement fund, tax-free savings account, etc

How Tito Mboweni will impact your retirement fund, tax-free savings account, etc

The Money Show’s Bruce Whitfield interviews Victoria Reuvers, Senior Portfolio Manager at Morningstar Investment Management SA.

What the ConCourt garnishee judgment means if you're in debt

What the ConCourt garnishee judgment means if you're in debt

Financial fitness coach, Paul Roelofse looks at a recent ruling that changes the way garnishees are administered.

The ups and downs of gold...

The ups and downs of gold...

It’s been exactly 12 months since financial fitness coach last spoke about gold as an investment option. Here are new insights.

Popular articles
I worked for that money! - Robert Madzonga (VBS shareholder Vele Investments)

I worked for that money! - Robert Madzonga (VBS shareholder Vele Investments)

The Money Show’s Bruce Whitfield interviews Madzonga, who claims innocence and that Chairperson Tshifhiwa Matodzi lied to him.

Take a look inside BMW South Africa’s high-tech X3 producing factory

Take a look inside BMW South Africa’s high-tech X3 producing factory

The Rosslyn plant makes 15 BMW X3 SUVs per hour for export around the world. Bruce Whitfield interviews BMW SA's, Tim Abbott.

The sun sets on Zimbabwe’s new dawn as inflation hits 155%

The sun sets on Zimbabwe’s new dawn as inflation hits 155%

Here we go again… The Money Show’s Bruce Whitfield interviews Africa Connected Host Lee Kasumba.

Pick n Pay sells most groceries in 5 years

Pick n Pay sells most groceries in 5 years

Recession? What recession? The Money Show’s Bruce Whitfield interviews Pick n Pay CEO, Richard Brasher.

Support for #CherlyZondi as she wraps up her testimony against Tim Omotoso

Support for #CherlyZondi as she wraps up her testimony against Tim Omotoso

Wits Institute For Social Economic Research research associate Lisa Vetten looks at how witnesses cope on the witness stand.

Sanral considers new measures to 'aggressively' tackle Gauteng e-toll defaulters

Sanral considers new measures to 'aggressively' tackle Gauteng e-toll defaulters

Discussions between Sanral, and the Ministers of Finance and Transport have apparently reached an advanced stage.

'The EFF presser was about blaming Pravin Gordhan'

'The EFF presser was about blaming Pravin Gordhan'

Eyewitness News reporter Clement Manyathela gives a summary of what came out of the EFF presser.

'Racism is a daily thing in Hartbeespoort'

'Racism is a daily thing in Hartbeespoort'

Hartbeespoort Community Development Initiative spokesperson Russel Baloyi talks about racism in the community.