Money mistakes during different life stages

NCR help KZN government host workshop on debt counselling

The KwaZulu-Natal government, in partnership with the KwaZulu-Natal Financial Literacy Association (KZNFLA),

South Africa’s number of over-indebted consumers is worryingly high. People are guilty of general financial mistakes, for example not applying self-discipline and splurging on unnecessary items, not saving, not having a spending plan, etc. Due to the fact that each life stage presents us with different needs, there are also very specific mistakes, linked to different ages.

To stay debt free and financially secure, steer clear of the following financial blunders.

Read the full article at https://yhoo.it/1t3uj6n.

In your 20s: Living above your means. Not saving for retirement

 

  • Very few people earn enough money in their 20’s to afford luxuries like travelling, the latest car, fashion, etc. Those that do over indulge end up with large sums of debt in the long run. A budget is non-negotiable.
  • Don’t fall for the illusion that retirement is far away. It is crucial to start saving as early as possible to ensure a comfortable retirement.

In your 30s: Combining finances. Delaying insurance

  • Many individuals in partnerships tend to combine all of their income with their partner or spouse. The possibility is always there that the relationship might end, leaving them off less financially stable than had they kept some of their finances separate.
  • A safer idea is to have a separate account for your income and share expenses equally out of a joint account. Also, keep any investments in your own name.
  • Insurance is an essential expense. The younger you sign up for insurance policies, the lower your rate is.

In Your 40s: Funding further studies over retirement accounts. Not saving enough

  • The more you can save and the sooner you save it, the better. It is easier to contribute a small amount of money monthly than a large sum at once. It is not pleasant to realise you’ve turned 60 and have no retirement savings.
  • If you have children, avoid helping them pay for their further studies at the expense of your retirement funding. Do what you can do to save for both, but place your retirement needs first.

In Your 50s: Co-signing on a loan. Getting too defensive with savings

  • Nowadays, merely preserving capital is not a sustainable financial solution in this age group. Ensure that your money grows to avoid your bank account drying up.
  • If you have children, be cautious of co-signing to help them with big purchases

In Your 60s and Beyond: Underestimating medical expenses. Overlooking your income

  • Beware of simply living off your retirement funds. It is crucial to keep on proactively building and maximising your retirement funds. Use them to continue earning income, e.g. via stable dividend stocks, CDs or bonds that offer regular payments.
  • Do not underestimate health expenses: rather build in future medical needs into your retirement savings plan, and consider purchasing long-term care insurance.

So take that first step. Simply call us directly at 087 702 1738 or contact our supportive debt counsellors via our contact page. Dont have the time? Request a Free Call Back and one of our counsellors will contact you! Zero Debt is a certified Debt Counselling company.