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The three golden rules for saving

The three golden rules for saving

Date: 2014-07-18
In July, a month where attention to savings is given on a national scale, a lot is said about savings; from how to spend less in order to free up money to save, how best to identify your financial goals or how to invest wisely.

The many savings comments and advice given over this time could be quite overwhelming for somebody who realises the importance of saving, but doesn't know how or where to start.

"Fortunately, saving does not have to be difficult. Like any good habit it may seem challenging to start, but once you get going, it becomes second nature. Saving comes down to the fact that you need to be disciplined and get into the habit of saving as soon as you can," explains Aneesa Razack, Head of Strategy at FNB Savings and Investments.

Saving requires continuous effort and everyday expenses or overspending can easily chip away at the money you hoped to use towards saving. FNB Savings and Investment's Aneesa Razack, shares her 'three golden savings rules' that will help South Africans succeed in their savings journey.

Rule 1: Don't snub the small amounts - According to FNB Research, a key difference between savers and non savers are that savers believe in the value of small saving small amounts. "

Rule 2: Hands off! - Aim to keep your savings going for as long as possible so that your money will start working for you. You can use online calculators to calculate the future benefits of what you'll earn from this compound interest to keep you motivated.

Rule 3: Pay yourself first - Very often saving is something that people do with money that is left over after all expenses have been paid and it's almost time for the next salary, but rarely do we have money left to save at this time. "One of the secrets to saving is to 'Pay Yourself First' by saving something immediately as soon as you get your salary," says Razack. By placing a scheduled transfer between your transactional account and your savings or investment account, you in essence automate your regular savings and ensure that you pay yourself first.

"If you stick to these three rules throughout your savings journey, they will prove to be worth their weight to you in gold," concludes Razack