Latest news with #MomentumFinancialPlanning
The Citizen
16 hours ago
- Business
- The Citizen
How to manage your money instead of letting it manage you
Too many young South Africans believe they will only worry about money later instead of planning their money journey right from the start. Young people must manage their money and not let their money manage them if they want to have a secure financial future. Money management is important. Jessica Pillay, financial adviser at Momentum Financial Planning, says your first salary, side hustle or online gig is more than just income. 'Being young sets the stage for your journey to financial success. As South Africans gear up for Youth Month, it is time to flip the script. 'To be young is not just a phase but a launchpad, and the smartest way to get off the runway and soar is to prioritise money management and financial planning. 'Taking charge of your money early gives you a massive head start. Financial planning is not about how much you earn, but it is about what you do with what you have and the habits you build along the way.' She says that with youth unemployment remaining at record highs, rising student debt, and a cost-of-living crisis to contend with, building wealth can feel out of reach for young people, but small, smart moves today can unlock big wins tomorrow. ALSO READ: Fix your money mindset and improve your relationship with your finances Pillay says these money moves matter now: #1: Start saving for retirement as part of money management Yes, you should start saving for retirement as soon as you earn your first money. Pillay says compound interest works like magic over time. Even if you save a small amount consistently from your twenties, it can snowball into a significant retirement nest egg. The earlier you start, the more time your money has to grow. Many young earners do not even realise that retirement savings also come with tax perks. Contributions to retirement plans are tax-deductible, up to 27.5% of your taxable income. That means money back in your pocket while you invest in your future. #2: Build your emergency fund Just picture this: car trouble, broken appliances, job losses. Life happens. And when it does, an emergency fund is the financial safety net that will keep your life moving forward, Pillay says. 'Aim for at least three months' worth of essential expenses. It will help you to avoid debt and give you peace of mind.' ALSO READ: The link between your money mindset and your credit score #3: Do not confuse credit with cash in money management Credit cards and clothing accounts can be helpful, but only when you manage them wisely. 'It is easy to fall into the trap of treating credit as money you have on hand, but remember debt comes with interest, and the more you borrow, the more you pay back. It does not take long to start drowning in it.' Learning how to build credit responsibly, such as paying off balances in full and on time, can open doors later on, like qualifying for a home loan or better interest rates. ALSO READ: The financial habits young people need #4: Protect yourself with insurance Medical emergencies, accidents or a sudden disability can have long-lasting financial consequences. 'Young people often overlook insurance, but it is vital. Without medical aid or life and disability cover, one unexpected event can wipe out your savings or leave you financially stranded.' Pillay encourages young people to ask questions and own their money journey. Financial advisers can help as they are not just for the wealthy or the old. They are coaches, mentors and sounding boards whose sole purpose is to help you weave through complex decisions and set achievable goals. Whether you are planning your first big purchase, figuring out how to budget, or exploring investments, guidance from a trusted expert can help you avoid costly mistakes. 'Your first step does not have to be perfect, it just has to be intentional. You do not have to walk this journey alone. There is an adviser out there who is perfect for you and your money journey.
IOL News
12-05-2025
- Business
- IOL News
Homeownership warnings for mothers: understanding long-term financial impacts
'Homeownership represents stability and legacy. But it comes with responsibilities far beyond the initial purchase price. You're dealing with debt, credit, interest rates, and an unpredictable world. It's enough to make anyone's head spin, especially when there are often more immediate responsibilities to take care of,' Devar says. Motherhood significantly impacts the financial aspects of property ownership, according to Momentum Financial Planning's Esther Devar. She advises prospective homeowner mothers to seek professional financial advice and to account for all expenses beyond just the mortgage before making a purchase. Mothers need to be especially vigilant about the long-term financial implications of owning a home. According to a 2024 report from Lightstone, women are driving the local property market. Women-only buyers own 38% of residential properties, compared to just 29% owned by men. A report by Stats SA revealed that 45.4% of children live with only their mothers, while just 4.2% live with only their fathers. According to the latest 2024 Q4 DebtBusters Debt Index, reflecting trends up to early 2025, a significant number of South Africans continue to rely on unsecured credit and personal loans to cover essential expenses. This ongoing dependence highlights the persistent financial strain experienced by many households, particularly those already burdened by home loans. Devar said preparedness is key. 'People underestimate the importance of building a buffer into their budget. It's not just about affording the monthly bond; it's about affording the life that comes with the house.' The financial adviser said the first step, particularly for mothers navigating homeownership independently, is to get financially prepared. This means improving your credit record, settling outstanding debts, and saving for a substantial deposit. 'You don't want to be a slave to your bond. A larger deposit reduces your monthly repayments and can help you secure better interest rates, which is especially important when lenders are cautious due to high interest rates,' Devar warns. Getting pre-approved for a loan can also give buyers a competitive edge. Devar believes it sends a strong signal to sellers that one is serious and financially prepared, an especially important factor for women still facing gender-specific hurdles like income disparities or simply being overlooked in negotiations. She said buying a home is not the time to wing it. 'Ask as many questions as you need. Whether it's about neighbourhood safety, the condition of the property, or the total cost of ownership, make sure you're working with professionals who give you straight answers.' The finance expert said women, in particular, often carry additional safety concerns when choosing a neighbourhood. That may mean prioritising secure complexes or proximity to schools and family networks - choices that also affect the long-term affordability of the home. Devar added that once a woman owns the house, their next financial priority should be protection. That means not only obtaining home insurance but also understanding how to safeguard your investment against unexpected job loss or even a natural disaster. 'A financial adviser can help you choose the right insurance cover and build an emergency fund. This usually entails saving six months' worth of living expenses in an access bond to serve as a financial lifeline during tough times, hopefully avoiding the drama behind high-interest personal loans or missed bond payments.'
News24
30-04-2025
- Business
- News24
5 tips to manage debt and finances after public holiday spending
Reality can hit like a ton of bricks after major spending during long weekends. List all upcoming expenses and create a budget to help you recover. There's no shame in asking for help from a financial professional. The recent public holidays have blessed South Africans with an abundance of long weekends. But from holiday and shopping trips to days and nights out on the town, we wouldn't be surprised if there's a wallet-sized hole burnt straight through your pocket. Reality can almost feel like a financial hangover after days of exorbitant spending. Patricia Temba, FNB's retail collections executive head, explains that 'When the excitement of the season wears off, you might ask yourself 'Why did I spend so much money?', followed by a flurry of physical symptoms such as self-blame, guilt and self-isolation brought on by the shame of your new-found financial situation of being further in debt.' While feelings of regret are normal, now's the time to practice some self-empathy and jump into regaining control of your spending. Here are expert tips to actively manage your debt and get control back of your finances: the season's impact on your finances During holiday periods, many often feel the pressure to spend on travel, buy gifts or host family, even when money is tight. That said, remember that it's also possible to find a way back to a more balanced financial situation. Patricia says, 'Creating memories that matter is normal and so is the financial cost that often comes with that. As a financial institution we understand that spending time with family is incredibly important, so we don't look at this from a judgmental point of view. In fact, we want to support our customers by walking them back as they rebuild their financial confidence.' 2. Assess your financial situation It's easy to ignore your finances – avoiding bank statements and unopened bills after the holidays. But facing reality head-on can be the difference between sinking in debt and getting back on track. 'List everything, including your debts, monthly obligations, and upcoming expenses,' says Lethukuthula Ngcobo, the product manager at FNB Integrated Advice. 'Realise that clarity is empowering. Seeing it all in front of you might seem scary at first, but it's equally important as it gives you a concrete lay of the land and helps to kick your brain into problem-solving mode.' 3. Prioritise and budget towards financial freedom What you want to avoid, now that the holiday high is over, is continuing to make bad decisions with your money. Financial stress doesn't just impact our wallets – it keeps us up at night, affects our mental health, and limits our choices. JJ van Wyk, a financial adviser from Momentum Financial Planning, says, 'Financial freedom isn't reserved for the rich – it's a right that all South Africans can and should work towards. And just like our country's struggle for political freedom, the journey to financial independence starts with awareness, discipline, and small, bold steps.' These steps include building a savings habit no matter how small, investing early and not being afraid to ask for help. 4. Steer clear of new debt After a big spending spree, relying on credit cards or loans may seem like a quick fix—but it can trap you in a cycle of debt. Staying financially disciplined is key to building lasting stability. Lethukuthula says, 'To help yourself pause all non-essential spending and steer clear of taking on any new unnecessary debt, ask yourself, 'Can I afford this?' or 'Am I willing to take on more debt to bring me more financial pressure in the long run?' Adding that tiny mindset shift can help you curb stress-induced emotional spending in the moment.' 5. Contact your creditors early Most people delay proactively reaching out to their creditors when they are struggling. But sitting around and just hoping things will improve is not the best approach. Lethukuthula also believes that because of the deeply psychological nature of money matters, many keep their financial issues to themselves out of fears of judgement or shame. 'If you're feeling overwhelmed, it's even more important to speak to your lender. You'll find that contacting your financial institution and explaining your situation will feel more like a relief than a confrontation. There's no shame in reaching out because we're here to offer solutions not obstacles.'
