Balance up
Draw up a balance sheet of all your assets and liabilities (debt). Keep this as a record of how your finances are faring. It must include all your debt from your house to your credit card. Include the current value of your pension fund on the asset side.
Set a goal for the year
In a year’s time you want your balance sheet to look a lot healthier. Set yourself a goal, either to reduce your debt or to increase your assets through saving. Go through your expenses and see where you can cut down to assist you in meeting your goal. Determine how much you can afford to save each month and regard this as a bill that has to be paid.
In January Sanlam is launching SanlamConnect (www.sanlamconnect.co.za), a web-based investment tool. It is designed to assist the layperson to understand their financial situation and the steps that need to be taken to achieve financial goals.
Prepare for big expenses
Do you have a big expense coming up in 2008, such as school fees, a school trip or a major car service? Start saving now or put away a portion of your bonus so that you do not have to go into debt when the time comes to pay for it.
Six ways to spend your bonus
Take 10% and spoil yourself, you deserve it.
If you have a retirement annuity, invest 15% of your bonus. You will get a tax refund for this portion.
Settle debt and start the new year with a clean slate. Lock away your credit card.
Pay school fees upfront. You’ll probably get a discount and it takes the pressure off your monthly expenses.
Set a budget for Christmas gifts and stick to it to avoid a new year debt hangover.
Give something to a charitable cause or, even better, give your time.
Six admin updates
- Start your 2008 diary by filling in birthdays and anniversaries.
- Check that your passport and driver’s licence do not expire in the coming year.
- Read your medical aid update. Costs and benefits change each year and you need to let your provider know by the end of December if you intend to change your plan.
- Update your will or write one if you have never done so.
- Ask your long-term insurance broker to review your financial situation and ensure you have enough cover.
- Ask your short-term insurance broker to re-evaluate your household contents to make sure you are adequately covered.
Six travel tips
- Find out if your insurer provides roadside assistance and put the number on speed dial. If not, sign up with a provider such as the AA.
- Top up your insurance. Some companies offer top-up travel insurance, which provides cover and assistance for home emergencies such as burst geysers.
- Get your car serviced or at least check that your tyres are in good condition.
- Work on a holiday budget. Make sure it includes expenses such as toll fees.
- If you are going on a long road trip with children, buy a couple of inexpensive presents to hand out whenever their patience runs out.
- Make sure you have healthy snacks and drinks on hand to keep up sugar levels.