Having a savings plan is a way for people to grow their money and is a blueprint to help them achieve their financial goals, according to Janine Horn, a financial adviser at Momentum Financial Planning.
A big part of your savings plan is your savings goals, which can be long-term or short-term goals. Examples of savings goals include saving for a down payment on a house or saving towards a holiday.
Here are 5 tips to help you set your savings goals:
Know your savings goals
Set savings goals so you will have an idea in mind of what you are saving towards, and you will stay motivated to stick to your savings goals. Your savings goals can be a short-term savings goal like gifts for your child’s birthday or a long-term savings goal such as a holiday or a new car.
Motlatsi Mkalala, head of main markets at Standard Bank, said: “Setting goals will make the process of saving much easier because you will know what you are saving your money towards. It will also prevent you from being tempted to spend your money unnecessarily.”
Monitor your expenses
Track your expenses from that cup of coffee to your monthly subscriptions and how much data you purchase. This will help you see how much you spend and will give you an idea of what you need to cut down on. Any money that you save on reducing your expenses can be put towards your savings.
Take a closer look at your bank statement
Reviewing your bank statement to see what your monthly expenses are. This will help you identify what is causing your monthly expense leakage. Once you know what the leakages are, you can channel more funds towards your financial goal.
Budget
If you have a budget, make room in your budget for savings. Your monthly budget can take into account the money you have freed up by cutting down on your expenses.
According to Ester Ochse, product head: FNB Money Management, having a budget allows you to have a look at where you can free up cash that can be saved for an emergency.
Extra contributions
If your finances allow for it, make a little extra contribution towards your savings so you can meet your savings goal faster.
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