1. Reduce your bank charges
Do you know how much you are paying for bank charges? Go over your bank statements for the past six months and get an average of the fees you’ve paid. Then go online (or into your bank) and find out what their fee packages are. You can pay a set rate every month, which entitles you to free services. Find one that matches your usual transaction pattern and you could save R50 to R100 per month on fees.
2. Reduce your credit card interest
At the same time, find out what interest rate you are paying on your credit card (if you pay off the full amount spent every month it doesn’t matter because you don’t pay interest). Chances are that when you applied for the credit card you practically had to beg for it, but maybe by now your credit rating has improved and you can negotiate a better interest rate. You have been using it responsibly, never falling behind on an instalment, haven’t you?
3. Cut the interest rate on your bond
Similarly, if you have been an exemplary account holder with your credit card, bond and current account then now is the time to ask your bank for a better bond rate too. According to Adrian Goslett (CEO of RE/MAX SA): “Every 0.5 percent reduction in the interest rate on a home loan of R1million represents an interest saving of more than R85 000 on a 20-year bond”.
4. Vacuum up the bargains
At the beginning of every month, diarise expenses you know you will have such as birthdays, car services etc. Set a budget and plan your purchases. This way you can shop around and get bargains or at least fair prices. If you make hasty, last minute purchases you tend to spend too much. If the event is top of mind then every sale you walk past is an opportunity to find a bargain gift.
The same can apply to Christmas gifts. Don’t let it be a last minute expensive trolley dash. Make a list of people who you normally buy for, set a budget (per person), then think of a gift to buy each person, couple or household. Plan the gifts as early as September. That way the expense can be spread over four pay days instead of one. And again, make good use of sales.
5. Shake out the money bugs
We all have little bugbears in our finances: traffic fines that haven’t been paid, tax returns that haven’t been submitted or accounts that are in arrears. All of these attract further interest and penalties and if you ignore them the financial consequences can become substantial. If you really can’t pay them all off then at least contact the creditors and make arrangements with them to start a payment plan. You will be surprised at how relieved you will feel. Those worrisome financial items that niggle at your conscience will be aired out and fresh in no time!
And I’ll leave you with a sneaky little tip to plump up your cash reserves in the short term: transfer all of your surplus cash (after all bills are paid and the month’s known expenses are catered for) into your savings account. Then when you splurge out on those shoes or that wine, you actually have to decrease your savings, which will make you think twice!
Well, we think these tips may help to stretch the rand. Do you think these tips might help you too?