Advice from the experts

How to protect yourself from financial fraud

Many of us have experienced that sinking feeling when we realise we’ve been conned. If you’re lucky, you may have lost only a battered old wallet containing a few banknotes. Others may not be so fortunate. Media regularly carry reports of highly experienced business leaders who’ve lost substantial amounts after falling prey to smooth-talking conmen promising investment returns well above the norm. “You go through so many emotions when you realise that you, or someone close to you, has been scammed,” says Shafeeka Anthony, Marketing Manager of personal finance website JustMoney. “Your feelings of trust, dignity, security and self-esteem are affected. Life seems uncertain and out of control.  “There’s also the stress of spending hours with the police, banks and other institutions in order to report fraud, close compromised accounts and obtain new documents.” According to the South African Banking Risk Information Centre (SABRIC), which keeps people informed about the latest banking scams and fraudster activity, digital banking incidents increased by 20% in 2019 on the previous year.  Cybercrimes are increasing at an “alarming” rate, according to the SABRIC 2019 annual crimes stats report. These crimes will eventually replace many ‘traditional’ bank crimes as they “transcend time and physical proximity due to their virtual nature”. Says Anthony: “You may not think your information is important enough to interest a fraudster, but in fact a cybercriminal could be looking for an identity just like yours to avoid raising suspicion. Your details – name, address, ID and bank details – could be used to apply for a credit card or loan in your name, or to create a fake driver’s licence or passport.” JustMoney offers the following tips to avoid being fleeced by a fraudster: Use tough-to-crack passwords, keep them to yourself, and change them regularly. Don’t click on hyperlinks or open attachments if you receive an email from a stranger.  Protect sensitive information by installing antivirus, firewall and spyware protection on your computer. Keep this updated. The lockdown has led to much more online shopping. Only do business with familiar companies. Take care of your filing. Documents can be stolen from your car or office without you being aware that they are missing or have been copied. Shred or burn documents with sensitive information rather than adding them to the recycling.  Do not carry all your ID cards or documents with you. Generally, only one is necessary for day-to-day activities, so lock the rest away. Do not use internet café s or communal spaces to shop or bank online.  Read a JustMoney article with more tips on protecting yourself against banking fraud here. Find out more about how to identify an investment scam here. “Given the current Covid-19 conditions, some fraudsters ask for donations on behalf of real or fake non-profits, claiming to assist people affected by the pandemic,” says Anthony. “While most of us are happy to help a good cause, take time to check the legitimacy of a non-profit organisation, or the person contacting you, before making a donation.” Read more on how to avoid being scammed for a good cause here. Credit check Another helpful tip from Anthony is to check your credit report regularly. This is a record of your financial history that shows your outstanding debt, both long-term and short-term, and the number of accounts you have open. It can provide an early warning of fraudulent activity.  Read a JustMoney guide to credit reports here and sign up to get a free report here. Report fraud If you have been a victim of fraud, report it to the police immediately and ask for a case number. You can also contact the SA Fraud Prevention Service on 011 867 2234 or at www.safps.org.za, should your ID be used to commit fraud or be stolen. JustMoney JustMoney is a personal finance website that provides busy and digitally-savvy South Africans with easy access to financial products, services and information. It does this by partnering with trusted financial brands and creating informative, trustworthy advice. Check it out at JustMoney. Stats source: SABRIC annual crime stats 2019 https://www.sabric.co.za/media/1265/sabric-annual-crime-stats-2019.pdf

June 30, 2021

5 Great reasons to shop & sell preloved children’s clothes

It’s a challenge to keep your children in style when they outgrow their trendy clothes so fast! With more people selling and shopping preloved clothing online, you can now keep your little ones in style, while spending less money; saving time; doing good for the planet and even making a bit of extra money!  Being a mom of two children and passionate entrepreneur, Aune Aunapuu, CEO and Founder of Yaga.co.za – the fastest-growing online marketplace for buying and selling preloved items –  decided to create the solution when she was unable to find a safe and hassle-free platform online to sell a preloved baby stroller.  Aune shares her five reasons why shopping and selling preloved children’s clothes is a great idea. 1. Keep Your Kids in Style:Shopping preloved clothing online means you can explore a variety of items, a diverse range of styles and many different brands that are always in fashion. Through preloved platforms like Yaga, parents can buy classic, vintage and stylish branded children’s items including Zara, Cotton On, Keedo, Naartjie and Truworths.  2. Save Money: Buying new children’s clothes is expensive and they outgrow their new clothes so quickly! You can get a lot more for your money by opting for preloved clothes, which are available at bargain prices and often at a fraction of the retail prices. You can replace an entire wardrobe of outgrown clothes without overspending.  3. Save Time: Because children grow so fast, it’s back to the shops every so often for a new wardrobe. Shopping preloved items online, on the other hand, saves you so much time usually wasted visiting shop after shop with a stroller and toddler in tow. Shopping preloved clothes online affords you the opportunity to shop an entire new wardrobe of trendy and branded items without ever leaving the house.  4. Do Good for the Planet: Buying and selling preloved can reduce your impact on the planet because it keeps fashion items in circulation, instead of it ending up in dumps or landfill. As most clothing items are processed with chemicals, the fact that preloved items are already pre-washed multiple times means that they are also less harmful for little ones wearing them close to their sensitive skin.  5. Make money!: All parents welcome a bit of extra money, so why not turn a wardrobe of outgrown fashion items into an extra income! Declutter your children’s wardrobes, organise the clothes your children have outgrown by size and season, and then sell these preloved fashion items online. Selling preloved baby and maternity wear is also super popular! Check out some of these trendy mummy Yaga Shops that sell cool items for children: https://www.yaga.co.za/whatreignwore and https://www.yaga.co.za/makeitrayne  For more information visit yaga.co.za.

May 12, 2021

Shaping your children’s attitude to money

Most parents will agree that teaching children about money is important, but what and how should you be teaching them and at what age? It’s an inherent part of parenting. Most children’s attitudes to money are shaped by their parents, whether you pro-actively pass on information or they just copy what you do. It’s also not something you can leave too late. A University of Cambridge Study, commissioned by the UK’s Money Advice Service, found that in that country children’s money habits are formed by the age of seven.  Shafeeqah Isaacs, head of financial education at financial services provider, DirectAxis, canvassed some of her colleagues with children of different ages about some age-appropriate lessons to help children become financially responsible adults. Age 3 – 5: You can’t always get what you want, right now We live in an era of instant gratification, from takeaway foods to online shopping. While your three-year old isn’t likely to be ordering Uber Eats during naptime, teaching children early that some things are worth waiting for may prevent them racking up credit-card debt on trendy clothes or the latest tech later in life. Set attainable goals. For example, if your child wants a particular toy explain they’ll have to save for it. Have a savings jar or piggy bank into which you can put birthday money or small rewards for helping out, good behaviour or achievements.  Try to set them up for success by making sure the goal is achievable and they don’t have to wait for months and lose sight of what they’re saving for. Each time your child adds money to the saving jar, help him or her count it and work out how much more is needed to reach the goal. Age 6 – 10: You’re responsible for the financial choices you make You can teach your children the basics of financial decision-making by explaining financial priorities. For example, you can tell them how when you get paid, you first need to pay bills such as the home loan or rent. Then you need to buy groceries. If you do this carefully and don’t spend money on things that are too expensive or which you don’t really need, you’ll have some left over. Some of this you can save and some might be used to do something fun together. Practical experience is the best way of driving these lessons home. When they earn pocket money for doing household chores, help them work out a budget. First, they’ll need to pay bills, such as contributing to a pet’s upkeep. Take them along when you buy the groceries. If they want something special get them to contribute to that as part of their grocery spend. Remind them not to spend all their money as they’ll need to save some. Hopefully, if they’ve not spent too much they’ll have a bit left over to treat themselves.  “The point is to give children a practical understanding of how to manage money using examples that are familiar. The more you can do this the better, as they’re far more likely to grasp this than abstract explanations,” says Shafeeqah. Ages 11 – 13: The sooner you start saving the sooner you’ll reach your goals At this stage you can introduce the idea of saving for long-term goals. Perhaps set a goal for something more expensive that he or she really wants. Often at this stage children are reluctant to save because they want to buy things such as snacks at school or more airtime. By setting a bigger goal you can teach them that the opportunity cost – what they need to give up – will enable them to save more and reach their goal faster. You can also teach them about compound interest: how by saving over a longer period, they benefit from the compounding effect because they earn interest on the money they’ve saved as well as the accumulated interest. For more information about compound interest visit: https://www.directaxis.co.za/find-an-answer/what-is-compound-interest Of course, when saving larger amounts of money, it’s sensible and safer to replace the piggy bank or savings jar with a bank account. Some banks, such as FNB, offer no-fee transactional accounts for children. This will also teach them how to manage a bank account. Ages 14 – 18: Understand how to borrow sensibly As children grow up their earning potential increases. They may graduate from doing household chores to getting a casual job. Typically, their expenses also increase. They may want to buy a scooter or motorbike to get around or even save towards a car.  At some point they’ll probably ask to borrow money. When they do, set a goal in terms of what they’ll need to earn before you’ll match them or lend them the remainder. Work out a reasonable period for the loan and a repayment schedule and charge them moderate interest. Explain there’ll be penalties if they miss payments and that you’ll also be less likely to lend them money in future. While they may not immediately appreciate it, you’re teaching them the benefits of paying what they owe and also how to build a good credit record. As they get older you can use a similar approach to teach them the difference between good and bad credit, such as loans to fund tertiary studies or start a business as opposed to borrowing money to fund an unaffordable lifestyle.  As a parent, teaching children about money isn’t something you’ll ever stop doing. Perhaps the most important lesson of all is to remember that you are a role model. “If you’ve ever heard a child use a grown-up word or expression they didn’t learn in school, you know they suck up everything around them. The same applies to how they learn about money. Remember that and the influence you have not just in terms of what you teach them, but your own financial behaviour,” says Shafeeqah.

April 30, 2021

Couples and Cash

A year in, the impact of COVID-19 is not only being felt by couples physically and emotionally, but it is also exposing incompatibility in personal finances. There’s plenty of fuel available for a money fight. Living and working in close proximity becomes even harder if your spouse has lost a job or fallen ill. Dealing with a smaller household budget, plus home schooling, adds to the strain. Take away family back-up, as we try to keep elderly relatives safe, and you have all the triggers for a strained relationship.  Whether you are already in a marriage or considering a commitment, it’s more important than ever to discuss and understand each other’s views about money.   “Taking the time to understand how you each approach your finances, and how to navigate a better way forward, can pave the way for a happier relationship and home life,” says Shafeeka Anthony, Marketing Manager of personal finance website JustMoney. Couples and cash In many relationships there is a spender and a saver. There is often one party who runs out of money first, and who doesn’t stick to the budget. “It’s important to remember that, no matter how much you have in common, your partner’s attitude to managing money may differ greatly from your own. This is shaped from a young age and is difficult to change. No one approach is necessarily right,” says Anthony. Money personalities The way that people manage their money is highly personal. Big spenders enjoy brand names and the latest gadgets, and are likely to take greater risks when investing. Savers, on the other hand, read through newspaper inserts for bargains, turn off the lights when leaving a room, and are risk-averse when it comes to investing. Shoppers get emotional satisfaction from spending up a storm, and can easily go overboard on credit. When financial opposites attract, this can lead to fireworks. Arguments about money can quickly become intense. It’s easy to feel criticised, even if your partner’s comments are well meant. Counting on credit Couples considering borrowing would do well by consulting their credit scores for a start. This is a tool that lenders use to decide whether an individual is a low or high-risk borrower. When you apply for a loan or credit, the bank or lender first checks your score and accompanying report. Your credit score not only determines whether you will receive the loan or credit, but also the interest rate you will be charged. “Knowing your credit score is extremely helpful if, for example, you are a young couple and want to find out whether your dream of buying a home can become a reality,” says Anthony. Read an article on ‘Should you strive for an excellent credit score’ here. JustMoney has made the process easier with the launch of its new platform, CreditSav. This facility provides a free, up-to-the-minute credit score and report, along with content-rich articles, financial tools, and calculators. Click here to register and get your score, your standing in relation to others, the loans, and other products you’re likely to qualify for.  Debt stress Reducing the stress as a couple can be helped along with some basic tips to achieve financial success. One of these is avoiding bad debt – or, if you are already in a debt pit, tackling the issue proactively. If more than a third of your income goes towards paying your debt, and you are worried and stressed, it’s best to seek help straight away.  Read how to tell your partner about your debt here.  One option is debt consolidation, which combines a number of individual debts into a single debt. This can mean, for example, increasing your home loan and using the extra cash to pay off all your loans at a lower interest rate. Read this handy guide.  Couple and family finances When you both agree on your money goals, it’s a good idea to work out a household budget together. JustMoney has a handy budget calculator here. Another helpful tip is to have a regular financial check-in. This needn’t be a long and serious discussion, just a chat over a coffee or glass of wine will ensure you’re heading in the right direction.  To celebrate meeting a target, without breaking your budget, you can take a look at a range of deals published by JustMoney. Check it out here.  Whatever means you use to find and maintain your financial harmony, communication is key. “As with any aspect of your relationship, it’s important not to sweep money matters under the carpet. Deal with financial issues when they happen, together,” says Nicholson.

March 31, 2021

“Dad, do you have a spare R1.5m for me?”

As a parent, one of the best gifts you can give your child is a solid education but do you have any idea about how much it will cost to fund this education down the line and can you start setting aside money for it?  Here is a quick example using the OUTvest Education Calculator, which is a popular tool with forward-thinking parents who want to ensure that they have set something aside for when their children need it.  If you have a child today and you want them to start a 4-year University degree on the 1st of January 2041, you will need to have saved up R1 586 000 to fund this degree. The assumptions here would be that you would start with a lumpsum of R10 000 and inflation was running at about 6%. It is also working on the assumption that you would not be setting aside any money for residence and your child would be living at home.  When you start seeing numbers like R1.5m, it can be incredibly daunting but a key message when it comes to saving is that compounding is one of the most powerful forces around and real wealth gets built when you stick to a plan.  Let’s break it down and assume that you start with R10 000. You will need to save roughly R1483 per month up-front. If we assume that you will be generating an average investment return each year and you will be increasing your monthly premium by 7% per annum in line with inflation, suddenly R1.5m doesn’t seem that far away.  The problem with theoretical calculations like this is that life invariably gets in the way and keeping up monthly contributions may not always be practical and this is where the OUTvest team have something quite novel to bring to young parents in the form of its Crowdvest functionality. The Crowdvest offering allows people to contribute toward specific savings goals that other people have started. Taking advantage of the power of the crowd, you can then have friends and family contribute toward your savings goals and share the responsibility of helping your child get ready for university.  Giving your child the gift of a high quality education is one of the best ways you can set them up for success in the future and adopting a structured plan will take a big number like R1.5m and break it down into a bite-sized goal.  OUTvest is an authorised FSP. All investments are exposed to risk, not guaranteed and dependent on the performance of the underlying assets.  The examples used are for illustrative purposes only and depend on various factors. T’s & C’s apply.

December 18, 2020

Teaching your Children about Money

Hi all. I have decided this month’s column is going to be information about “teaching your children about money” because let’s face it, it is a very important skill to learn and the earlier you can teach your kids about money the better. My kids are 8 and 12 years old and I really wish I had started teaching them about money sooner. Tips on teaching your kids and teens money saving skills. Give them control of their money Otherwise they will think money will always be ‘on tap’ and that they do not have to be responsible for their spending or make plans to save for bigger things. Bad spending habits mean they will take longer to become independent and could have trouble with money. Teach them to save for money goals You might also create a chart together showing their goal, and little savings milestones along the way. That way they can get excited about watching their savings grow. Teach them that reducing expenses makes goals come faster ‘If I want to get to a goal faster, I have to save more…’ which means spending less on other stuff. Remind them about the decision they are making every time they want to spend money. Teach them about having a budget It does not have to be complicated, but teach them how to plan their spending, instead of having a big wad of cash that keeps getting smaller with every impulse buy. Introduce them to the concept of investing and the growth that is their money earning money for them. It is free money, almost! Teach them that the goal of marketing and advertising is to get us to part with our money, and how they affect us to make us do this. And talk about consumerism, and how it hurts us financially, how it is not good for the environment, and how it leads to a cluttered house full of expensive and wasted stuff. Teach them about impulse buying and that feeling of ‘I must have it now’ that we all know very well! Have a cooling off period about a bigger purchase and teach them that what we buy should not be to impress others… Give them control of their money otherwise they will think money will always be ‘on tap’ and that they don’t have to be responsible for their spending or make plans to save for bigger things. These are the tips from Dave Ramsey’s blog post. They are divided into ages and are aimed for kids right from preschool age right up to the teen years. How to Teach Pre-Schoolers About Money Use a clear jar to save. The piggy bank is a great idea, but it does not give kids a visual. When you use a clear jar, they see the money growing. Yesterday, they had a R5 coin, today they have a R10 note and the R5 coin. Talk through this with them and make a big deal about it growing! Set an example. Remember little eyes are watching you. If you are slapping down plastic every time you go out to dinner or the grocery store, they will eventually notice. Or if you and your spouse are arguing about money, they will notice that too. Set a healthy example for them and they will be much more likely to follow it when they get older. Show them that stuff costs money. You have got to do more than just say, “That pack of toy cars costs R120, son.” Help them grab a few Rands out of their jar, take it with them to the store, and physically hand the money to the cashier. This simple action will have more impact than a five-minute lecture. How to Teach Primary School Kids About Money Show opportunity cost. That is just another way of saying, “If you buy this video game, then you won’t have the money to buy that pair of shoes.” At this age, your kids should be able to weigh decisions and understand the possible outcomes. Give commissions, not allowances. Do not just give your kids money for breathing. Pay them commissions based on chores they do around the house like taking out the trash, cleaning their room, or mowing the grass. Dave and his daughter Rachel Cruze talk a lot about this system in their book, Smart Money Smart Kids. This concept helps your kids understand that money is earned—it is not just given to them. Avoid impulse buys. “Mom, I just found this cute dress. It is perfect and I love it! Can we buy it please?” Does this sound familiar? This age group really knows how to capitalize on the impulse buy—especially when it uses someone else’s money. Instead of giving in, let your child know they can use their hard-earned commission to pay for it. But encourage your child to wait at least a day before they purchase anything expensive. It will likely still be there tomorrow, and they will be able to make that money decision with a level head the next day. Stress the importance of giving. Once they start making a little money, be sure you teach them about giving. They can pick a church, charity or even someone they know who needs a little help. Eventually, they will see how giving doesn’t just affect the people they give to, but the giver as well. How to Teach Teenagers About Money Teach them contentment. Your teen probably spends a good chunk of their time staring at a screen as they scroll through social media. And every second they are online, they are seeing the highlight reel of their friends, family and even total strangers! It is the quickest way to bring on the comparison trap. You may hear things like: “Dad, Mark’s parents bought him a brand-new car! How come I have to drive this 1993 Subaru?” “Mom, this girl at school got to spend R10,000 on her Sweet 16 party. I want to do that too!” Contentment starts in the heart. Let your teen

November 13, 2020

Bursary to empower the next generation of marketing professional

A successful applicant will be awarded a Nnete Modise Bursary, to study at The AAA School of Advertising.  The AAA School of Advertising is proud to partner with Alumnus, Abey Mokgwatsane and The Association for Communication and Advertising (ACA) to empower the next generation of marketing professional.  Abey Mokgwatsane is a very successful communications and business professional. He is currently the Managing Executive of Brand, Communications and Sponsorships at Vodacom. He believes in revolutionising the industry as we know it, by taking a stand to bridge the gap of inclusivity and equality opportunities for women in the communications industry.  The contribution and role of African women in the development of the marketing industry is visibly missing. Multiple conversations are had about bridging this gap and giving opportunities to women of colour within the industry, but not much is being done about it.  Thus, inspired by his late grandmother, an extraordinary woman, Nnete Modise, the Nnete Modise Bursary was born. This bursary will provide funding for a young talented and driven African female towards a marketing degree at the AAA School of Advertising.    “AAA was my ad school of choice because of its combination of theory and practical approaches to teaching marketing. The bursary on offer is for study from first year through to completion of the marketing degree. This is part of my personal commitment to be a light in the fight against Gender Based Violence as I believe the economic emancipation of women can go a long way in the fight against GBV,” adds Abey Mokgwatsane. “Having our alumni thrive and contribute to empowering talent makes us as an institution so proud. Abey is working in the industry that sees first-hand the potential of an amazing career path. He is very passionate about developing young people’s potential, and together our aim with this bursary is to facilitate the empowerment and talent of young people to succeed and grow in this industry”, says Dr. Ludi Koekemoer, Acting CEO of AAA School of Advertising.  The requirements of the bursary for applicants include the following: the successful applicant needs to reside outside of the main commercial centres of South Africa. A written motivation of 500-words from the applicant’s educator accompanied by their matric prelim results. Also, to be included is an additional motivation letter from the student detailing their economic status and proof of residence. The bursary will also cover accommodation, ensuring that the prospective bursar’s ability to register and complete the three-year degree is further supported.  It is important to note that The ACA will coordinate the applications, short-listing of the students and administer the entire process on behalf of the Nnete Modise Bursary. All submissions must be sent to: [email protected]  Closing date for applications is 13 November, 2020. 

October 30, 2020

Making the most of time: To save for education

If you’re planning to save for your child’s tertiary studies, doing so early is the best way to do it.   The exciting news of welcoming a child into the world changes your life, and time can go by so quickly. Planning for tertiary education costs early, will make all the difference to affording the best education and opportunities available. You generally have at least 18 years to save towards university costs as a new parent. So, let’s assume for a 4-year bachelor’s degree, you’ll need as much as R85 000 per year for university tuition alone. This added up seems staggering, but will be more manageable to achieve over time, thanks to compound interest (provided you start saving early).  It is important to personalise your goals to know where you are going. One way is to define which university you are most likely to send your child to so that you can better quantify your savings goal. It might be difficult to picture it now, but this will allow you to more accurately ensure that your level of monthly savings matches the future costs of tertiary studies, to avoid a shortfall. It is important to note there is a large disparity between university costs in different provinces. The cost of residence or accommodation should you want your child to attend a university out of town should also be defined as this can be more than double the cost of tuition, which changes the savings requirement dramatically. There are a few key savings vehicles to consider using for these savings: 1. Tax-Free Savings Account (TFSA).This has the benefit of allowing you to save up to R36 000 per tax year (capped at R500 000 over your lifetime) without any taxation on the growth of the investment. So this mean you’ll pay no tax on interest, dividends or capital gains. This should be in your name and not your child’s, as you could be removing their right to have their own TFSA later in life, due to the contribution maximum limits. 2. Discretionary unit trust or ETF (Exchange traded fund)This is similar to a TFSA, but without the tax benefits. This should be considered if you are already using a TFSA in your personal portfolio. An ETF is an alternative to a unit trust fund, and usually tracks an index. 3. Endowment / Sinking fund policy.This should only be considered if you are already using a TFSA in your personal portfolio and your marginal tax rate is above 30%. As it is estimated that education inflation runs at around 9% per year, it is imperative to invest your money in the selected vehicle above in a high-growth portfolio that will target long-term capital growth at inflation plus 5% to 7% per year. This type of mandate should invest the majority of your savings in local or offshore shares. As you will be investing monthly, you gain the benefit of rand cost averaging (averaging your entry into volatile stock markets), which will smooth your return over time. As always this advice is assumptive and generic and you should always work with a Certified Financial Planner® to tailor a financial plan to your unique circumstances, and consider the appropriate investment mandate and tax structure that may impact you. Alexi Coutsoudis, CFP at PSG Wealth Umhlanga Ridge

September 10, 2020

Smart Money Goals

As Metropolitan’s Three Word Stories campaign draws to a close, consumers are given tips to  help with their finances during the Covid-19 pandemic and beyond Nobody could have predicted the turmoil the coronavirus pandemic would cause for the financial lives of most South Africans. Many people’s income has been significantly reduced, and thousands of others are facing the prospect of unemployment. As a result, the economy is contracting. The pandemic has forced all of us to consider critical questions about our financial security.  According to a DebtBusters report from the first quarter of 2020, South Africans were under severe financial strain even before the Covid-19 outbreak and are now increasingly cashing in their long -term investments for immediate survival. The pandemic is likely to continue to affect household finances for years to come. TransUnion recently reported that 79% of South Africans’ household income has been negatively impacted.  Therefore, being mentally strong, having a plan, prioritising spending and using resources efficiently is imperative to the financial stability for many families.  Now in its final week, Metropolitan’s Three Word Story campaign seeks to build resilience among South Africans by sparking conversations about real-life financial concerns, and ease their anxiety about the future by finding ways to deal with the challenges they face.  “Access to money has a great impact on how people experience the pandemic. Our food security, personal safety, health and so many other essentials depend on access to money. The questions consumers are asking themselves about their finances have never been more significant. How do I ensure my financial survival? Should I be saving more aggressively? How do I restructure my finances or my debt? How do I pull myself out of debt?  Our tips this week aim to help South Africans deal with tremendous financial challenges we are all facing and how to navigate through these unchartered waters,” says Llewellyn Allen, Head of Marketing: Metropolitan, “My hope is that these tips will assist people find a way to not become overwhelmed, but to dig deep to find their strength. The only way to conquer fear is through action, and that starts with reminding ourselves that we have the mental strength and resilience to deal with whatever financial challenges we face,” adds Allen.  Reassess your finances and budget accordingly: Many financial experts have predicted that the value of the rand is likely to fall. Consumers will be forced to spend more Rands to buy the usual items they bought before the pandemic. It is important to be realistic about where you stand financially.  Honest budgeting and keeping track of expenses serve as a great reality check. Be honest with yourself; the first step is to understand where and how you spend money. To do this properly, draw up a detailed, accurate account of everything your household spends money on in a normal month. Start by listing all fixed monthly expenses that help you maintain a basic standard of living. Then draw up a second list of variable expenses, including discretionary spending. Once you have both lists, compare them with your income and cut out any unnecessary items so that your expenses are less than your income. Even though removing luxuries from a monthly budget might be painful, the ‘new normal’ of social distancing and staying at home might make it easier to cut out the out of home luxuries.  Plus, it will reduce stress if you manage to reduce your expenses to be less than your income.  Involve the whole family: This is an opportune time for parents to talk to their children about where money comes from, why budgeting is so important, and how everyone in the family can contribute to lowering household spending by making compromises. Parents may want to consider reducing their children’s allowances now that most children are at home and not able to spend money on excursions. Set savings targets for the whole family and make it fun and practical. Seeing money accumulate in a glass jar in the kitchen and later depositing it into a bank account for safety can be highly motivating, and it can be the start of learning about investments and earning interest. Depositing the money in a bank account, not only keeps the money safe but also helps with fighting the temptation of spending the money when in sight.  Make smart financial decisions: A crisis such as the Covid-19 presents new opportunities for scammers and fraudsters to steal money by preying on people’s anxieties. Now is the time to make considered financial decisions and avoid the temptation of investing in and losing your money to get-rich-quick schemes. Speak to an accredited financial adviser if you need help with making smart financial decisions during this time.  If the household’s financial standing has changed during this difficult time, calm nerves are required to take stock of the finances and make adjustments if required. Information from credible sources as well as speaking to an accredited financial advisor can help to make sense of things. 

July 8, 2020

Four healthy money habits to teach your kids

Beyond getting your child’s own savings started, teaching your children age appropriate lessons about handling money is important. It better equips them, and you, to accumulate and maintain a steady growth on investments, particularly if everyone is on the same page about the family’s long-term saving goals.   A good example is education. Though online education opportunities have become quite popular recently, school fees remain a reality, and they can really add up over time.  Although COVID-19 brings up a lot of uncertainty, now is a great time to teach your kids some valuable financial lessons, so here are four healthy money habits to pass along.  Make money child friendly As your children get older, explore ways to teach them ‘adult’ money lessons in practical and memorable ways. One way could be to pay them ‘performance bonuses’ for spotting opportunities that save money in the home and in their schooling. When you do annual uniform shopping and they find a cheaper deal on school shoes elsewhere, invest the difference into savings.  You might consider opening a tax-free savings account on behalf of your child, or a unit trust account if your investment horizon is a little shorter. A formal way to save can make your children cognisant of the cause you are saving towards, and aware that their efforts are actively making a difference. You can also mimic the discipline of saving by paying pocket money on a specific date each month. This demonstrates that money isn’t available on tap and things, just like their education, need to be planned and saved for.  Allow trial and error Talk to your children about questions that they may have about money. By helping them understand what’s confusing them, it opens their mind to creative ways to work with it. Once your teenagers understand the concept of compound interest, the excitement and devotion to growing the initial amount might kick in.  Additionally, although the (weekly or monthly) pocket money you give them might be the same, their personal expenses will change. One month, your child might ask for an early withdrawal to buy a camera for photography class, and the month after, a book. By providing ‘statements’, your child will be less intimidated by personal financial planning and have a realistic idea of what it looks like to budget, review expenses and be conscious about using their money. More importantly, they will learn to plan ahead for what they need and want.  In this time, allow for mistakes so that they know not to panic when the environment or costs change. Intuition combined with your lessons are key to them navigating their newfound financial responsibility.  Check twice before clicking once The newer generation is growing up with the internet, but it is never a bad idea to teach them to shop safely and wisely while online.  Begin by teaching your kids the difference between a credit and debit card and which one you will be allowing for the online buying responsibilities you might give them from time to time. Emphasise that transactions should only be made on trusted sites and to make it easier, provide a list of places where you will allow the card to be used. You can also suggest they place an item in their virtual shopping cart for a day or two before buying, as this could result in realising the item isn’t necessary to buy, or some retailers may even send a discount for that item, hoping it will conclude the sale.  By giving older children the occasional responsibility of doing their own stationery shopping (with your supervision) not only will they learn how to compare prices and stick to the budget, but they will also learn to become familiar with the cost of things (and how they can change over time). Hopefully, your child will learn that financial planning is based on needs first, then wants. Textbooks? Need. New PlayStation? Want.   Play the role of an adviser Financial advisers are qualified professionals who commit to evaluating your current situation and help you build a realistic strategy toward reaching your ideal financial goals.  As your children gain more understanding, find out their financial goals. You want them to understand the role of a financial adviser in their personal financial planning journey when the time comes, but more importantly, to be honest with their adviser. You might consider including them in conversations you have with your adviser. Small lessons amount to big, well-informed decisions and as a parent, the ongoing lesson of being financially prepared is a gift that will reap many rewards in the future. Ronald King, Head: Public Policy & Regulatory Affairs at PSG

July 3, 2020

Budgeting is not for sissies but you gotta do it!

In the last article I touched briefly about budgeting and if you are serious about saving money then setting up a monthly budget is something that is particularly important to do. The reason being is because you need to know and understand where your money is going every month otherwise how you are going to find ways to save it!

June 5, 2020

Saving money, it’s not as easy as it sounds

Let’s face it, saving money today is not easy and I am the first person to admit it! I am a wife and a mom of 2 young boys, and it is very difficult. Society is not helping things in this department at all. It is getting more and more difficult to save money because everywhere you look there are big billboard signs, adverts on TV and social media, we are being bombarded all our waking hours with wonderful looking products, getaways, houses, cars etc they want YOU to buy.

May 1, 2020

Top Money Saving Tips for New Parents

Prepare in advance for the financial changes a baby will bring. Start saving as soon as you know you are pregnant, so you get used to living on a reduced income

February 4, 2020

The robo saving for your child

As December rolls around, many parents get to breathe a momentary sigh of relief that a monthly school fee payment won’t be going off this month. That is until you remember that you’ll be expected to re-start payments again in January and this time it will come with new text books, school stationery, uniforms and for the bigger “kids”, you might even be paying boarding school or accommodation fees.

December 20, 2019

Financial preparation for prospective parents

Having a baby can be wonderful. It can change your life in so many positive ways. You will love more deeply than you thought possible and moments like your child’s first words will become treasured memories.

November 6, 2019

Why climbing a tree is better than watching a screen…

It is all over the news! How much screen time is too much for young children?  What is it about this age of technology and the need to understand the dynamics of our changing world? Are we bringing up a generation of children who are comfortably able to live in a world of humans and computers? Are we allowing little bodies to develop fine and gross motor skills, critical thinking and problem-solving skills, imagination and creativity? Or are we choosing to remain blind to the negative effects that screen time is having on the physical and cognitive development of our children?  Or is it just easier to give in and ignore the very real possibility that too much time on electronic devices is stifling our children’s ability to learn effectively?” According to Cindy Glass, Founder and Owner of Step Up Education Centres these are critical questions and, unfortunately, the answers are not particularly favourable. She offers the following important points for consideration: Children learn by doing, not by having things done for them. Building puzzles, creating imaginative games, playing in the sand or climbing a tree require active involvement from children.  They need to think, solve problems and use their innate creativity to enjoy these activities. Furthermore, they develop important motor skills. In a nutshell, children learn how to use their bodies and minds effectively. Sitting for hours in front of a screen involves mindless pressing of ‘buttons’ and instant gratification. This is clearly not ideal for growing and developing children. We live in a world of other human beings. Playing games with other children, be it siblings or friends, involves learning essential emotional intelligence skills. Self-awareness, self-regulation, motivation, empathy and social skills are learned to a great extent, through interactive play. Parents who spend time playing games or making things with their children enjoy positive relationships and wonderful connections that cannot ever be experienced on a computer. Children who spend time outdoors enjoy the benefits of natural light, the warmth of the sun, exercise and heartfelt laughter. Their developing bodies can enjoy the freedom of running, climbing, riding bikes or sitting in the shade of a tree observing the little creatures that make up their world. There is no computer- generated game or activity that can mimic these essential, healthy lifestyle activities. We live in a world of increasingly demanding technology – that is a fact that we cannot ignore. But Cindy argues that it does not mean that we should deprive young children of essential life and developmental skills by allowing technology to override their natural and innate need to learn through active engagement with their world and all that it offers. “In short, little children do not need devices; they need trees and building blocks, puzzles and crayons,” Cindy concludes.

October 31, 2019

Plan to stay warm and save money this winter

Thinking ahead will often save you money. Last-minute decisions or leaving things until they become a crisis generally don’t. It’s why prepping your home for winter is usually time well invested. While winter weather isn’t the same across South Africa – wet and windy in the Western Cape, dry and bitter in Gauteng – it’s cold just about everywhere. DirectAxis spoke to some experts about how to prepare your home for winter. We asked that their tips had to be things that most home owners can implement without too much expertise. Unsurprisingly, keeping out the cold topped the list. Although insulating your home is a good idea anyway, doing so at a time when the electricity supply is under pressure is doubly beneficial. Not only will you save electricity, which is going to get more expensive, but it’ll be easier to keep warm if there is more loadshedding.  Check your doors and windows for draughts. It’s relatively easy to fit self-adhesive rubber seals to the bottom of doors which are letting cold air in. Alternatively, you can make or buy a sausage-dog draught-stopper to block the gap.  Do the same with windows. Repair glass that isn’t fitted properly or where putty or seals are damaged, fix windows that don’t seal and replace any worn or missing weather strips. Although these seem like small steps, sustainability websites claim that you can lose up to 15% heat through draughty doors and 10% though unsealed windows. Curtains are better than blinds for keeping out the cold and retaining heat. When there is a bit of warmth and sunlight you can keep them open to warm the house and close them at night to keep the warm air in.  Once you’ve finished at ground level move to the ceiling. If you don’t have insulation, consider getting some. It’ll keep you cool in summer and warm in winter. It’s not difficult to fit, but if you have doubts about your DIY abilities, call in the experts. Every house differs, but expert opinion holds that an average house will lose about 25% of heat through the roof. While you’re up there, check if you have a geyser blanket. Heating water requires a lot of energy, up to 40% of household electricity usage, so insulating your geyser will save you money in the long run. Geyser blankets aren’t very expensive, around R300 on average.  When you’ve finished insulating the inside of your house, check the outside. If you live in a winter rainfall area, clear your gutters of leaves and other debris. Water in clogged gutters can break the brackets that support them. The water also needs to go somewhere. If you’re lucky it will pour harmlessly over the side, hopefully not above an entrance. If not, it can blow up under the tiles and damage ceilings and fittings. While you’re up there look for loose, broken or missing tiles or ridge tiles. These can cause leaks or allow wind in, potentially causing more damage. Also check that seals around chimneys or other fittings such as skylights are intact. Take a walk around to see if there are any trees that might blow over or branches that could break and damage the house or installations such as satellite dishes. You may be able to trim them yourself, but if the tree is too big, you don’t have the right equipment or aren’t sure about what you’re doing, it’s best to get in a professional. Bear in mind some indigenous trees are protected, so if you’re not sure ask an expert. Pack away or cover garden or stoep furniture that you aren’t going to use. Winter weather can damage wooden and metal furniture and even plastic perishes when exposed to the elements. If you live in a region prone to high winter winds, consider that outdoor furniture which gets blown around could be destroyed and can also damage anything it hits. While you’re looking around outside, check the lighting. It gets darker earlier in winter, so this is a sensible security precaution. Well-lit paths and approaches will help deter criminals. There’s also the practical benefit that it will prevent you or any of your family or friends tripping and falling in the dark. DirectAxis’ chief marketing officer, Marlies Kappers, says the experts agreed that preventing problems is always less expensive than fixing them afterwards. “Thinking ahead and spending a little on some basic household maintenance will save money in the long run. Small improvements to your home will also help retain or even increase its market value.” For more information on home improvements visit: https://www.directaxis.co.za/imagine/loan-for-home-improvement

June 13, 2019

Why Your Child Should Be Getting An Allowance

If your child has just started learning the difference between bills and coins, it won’t be long till they’re asking for their own share. And while that might be a little scary for you – they grow up so fast – there are lots of really good reasons to start giving your children an allowance. So if you’re on the fence about whether you think your kids are ready for some responsibility, here are four reasons why an allowance might be a good idea. Reason #1 – They learn how to budget When your child starts receiving an allowance, it’s the perfect opportunity for you to introduce them to budgeting. Because they’re now dealing with their own money, kids learn how to start prioritising where it goes – how much goes towards lunch money or after school treats, toys or video games. By teaching them to work to a budget you’ll be giving them a lesson in self control. That’s not always an easy lesson for kids to learn, but making the effort to curb bad habits when they’re young can prevent a lifelong habit of impulse spending. And that’s becoming increasingly important these days. Mozo conducted research into Australia’s obsession with post-pay layby service, Afterpay and found that 1 in 4 shoppers using the service experienced financial stress. That points to a worrying trend of overspending in Aussie adults and high personal debt, which appears to be a global trend. So the sooner your child gets into the habit of spending within their means, the better they’ll become at managing expenses later on in life. [ads2] Reason #2 – It’ teaches them how to set financial goals Budgeting goes hand-in-hand with setting financial goals, which for kids, usually means saving up to buy something they really want. And although owning the latest Mickey Mouse Play Doh set requires a little less work than buying a home, setting small goals builds good habits, like dedication and commitment. Knowing that you won’t just be buying them things they want and instead, when they want it, they’ll have to save their allowance starts kids on the path to thinking about their money long-term. It also means they’ll learn the skill of prioritising their spending and making hard decisions, like whether they want a treat right now, or extra spending money when your family goes on holiday at the end of the year. Let them pick their own short and long term goals, whether it’s the latest video game or a new toy, that way, the payoff will be meaningful to them. And as they inch closer to their goal, they’ll see the value in putting money away. One fun way to keep them on track is to design a motivation board. Grab some glue and stick pictures of their ‘goals’ onto cardboard, before hanging it in their bedroom where they can see it everyday. And if your child isn’t one for arts and crafts, many savings accounts offer virtual planners and activities to help kids manage their money online. The other thing to keep in mind is to make sure that if you’re encouraging your child to set savings goals, their allowance is enough to let them actually reach that goal within a reasonable amount of time. For instance, while a teenager might be willing to wait to buy their first car, a child in elementary school hoping to land a new LEGO set might not stay interested after a couple of months. So do the math and make sure that they’re not setting their expectations higher than your wallet can afford. Reason #3 – They’ll reap the benefits of saving If there’s one virtue that’s lost on many children, it’s patience. But by keeping your child from running to the lolly aisle at the first chance they get, they’ll enjoy one of the long-term benefits of saving – compound interest. The longer kids have savings stashed away, the more time there is for compound interest to work its magic and grow their funds. So give them a place to stash their new ‘income’ by opening up a savings account, so they can make regular deposits and start earning interest today. Then, by the time they finish high school, they’ll have a nice little stash to take away to college, go travelling or just to keep in case of emergencies. If you really want to give them a head start, it might be a good idea to match their savings to help them stay focused, like adding an extra $10 a week. Because if you did this from the age of 5, they’d have a whopping $6,240 by their 18th birthday – not too shabby of a gift! [ads2] #4 – It’ll give them a taste of independence Many kids just can’t wait to be treated like an adult and having their own money, especially if they’re taking out the trash every night or keeping their room tidy to earn it, is a great first step towards that kind of independence. Having their own money means they can start to make more independent decisions about how they want to use it, which can keep them motivated to continue saving. They might even decide to try a new hobby or learn a new skill with their newfound wealth which gives them a chance to work out who they are as a person. Financial independence can be addictive! If you’re the parent of a teenager, you could make things interesting by giving ‘salary negotiation’ a go. Sit down with them and talk about the quality and quantity of work they do around the house, then discuss whether their current allowance reflects this accurately. Even though they’re a long way away from doing this with an actual employer, it does give them the chance to test drive their negotiation skills and put their own price on their time and effort. Just don’t be surprised if they get too clever and start organising monthly negotiations! The next step –

May 30, 2019

Motivating your teenager in preparations for examinations

Parents are often just as stressed, as their teenagers are when it comes to preparing for and writing examinations. Books and articles on the subject are limitless and easily accessible – try Googling it. The problem is, that there is just so much to read, that by the time you are done, your child would have finished schooling. The advice given in these articles is very much the same. They all speak about planning, goal setting, study methods, working environment, nutrition, rest and communication. You are bound to pick up handy hints from any article you read. You will soon realise that the advice in most articles is relatively obvious and is probably something that you would have figured out for yourself anyway. Sedhoorajan Padayachee, Principal at Abbotts Colleges Northcliff believe that it would be more helpful for parents to understand how their teenage children think and what they want during this challenging phase of growing up. If this is better understood, then motivating teenagers to study becomes a far easier task. Like all subjects in the technologically advanced world we live in, literature on understanding teenage behaviour is also exhaustive. I can however, refer you to a short and very informative article on the subject by Dr Debmita Dutta (30 December 2018) Dr Dutta reminds us that the three things teenagers want most are freedom, independence and respect. She goes on to explain that most teenagers are not motivated to study because they see studying as an unending drudgery; they believe that even if they study they will not have freedom or independence and still risk the chance of being reprimanded and not respected. Dr Dutta further proposes that parents: 1. Motivate their children to learn rather than perform 2. Don’t bribe or punish their children to learn 3. Be patient sensitive and understanding 4. Allow and encourage lots of physical activity 5. Explain the “why” behind what teenagers are studying 6. Don’t compare their child to others 7. Encourage the company of adults other than the parents 8. Give their teenagers mental challenges 9. Do not try to control 10. Allow friendships 11. Do not criticise 12. Do not be grumpy and complain 13. Show their passion not their worry 14. Do not pressurise teenagers with praise 15. Stop panicking and looking disappointed. All of the above recommendations are substantiated in the article, which is a must-read. Parents are advised to always be around, if possible, when their children are studying. Leaving them alone is strongly discouraged as this could be interpreted as neglect and indifference. Just be around for moral support without creating the sense that you are policing them. Besides, by just being around, the temptation for your teenager to do something else during study time will be discouraged. You may feel that it is premature to offer this kind of advice now, considering that it is so long before the June examination. Parents and students have become accustomed to receiving guidance on examination preparation three or four weeks before the examination. This is probably why students do not do as well as they are capable of. Examination preparation should not start a few weeks before the examination. It should start at the beginning of the year in the classroom from day one. Students must listen to their teachers with intent all day, every day. Encourage your children to pay attention in class ensuring that nothing distracts them. More than half the battle is won in the classroom. Absence must be discouraged at all cost, unless it is unavoidable. Students believe that they will make up for lessons missed on their own – this is not the same as receiving instruction from the teacher. This is the first step to successfully preparing for the examinations. Stress and anxiety can be avoided if preparation is constant and not crammed just before an examination. Inculcate these good habits in your teenager and you will pave the way for their success. Written by: Sedhoorajan Padayachee, Principal at Abbotts College Northcliff

April 16, 2019

Electronic vs. Manual Breast Pumps: Which Works For You?

Many people debate over whether they need an electric or manual breast pump. Truth be told, there is no right side to this discussion. Both manual and electronic breast pumps have their purpose within the breastfeeding world. Knowing which best suits your lifestyle is the key question one should be asking. We shall discuss this below, so read on ow to see which pump best suits your needs. Electric Breast Pumps The electric breast pump has been in production since 1991. This was introduced to the world by the Swiss company, Medela, who managed to produce the first ever electric-powered, vacuum operated breast pump. From then on, the electronic pump has grown exponentially, with hundred of suppliers and models available. But what are the advantages to having an electronic pump? The Pros Of The Electronic Breast Pump It is time efficient – taking less time than a manual pump to express This type of pump requires less effort to use than a manual pump There is a wider variety of models to choose from, including hospital grade pumps Offer you the option of hiring – please note however, only hospital grade pumps can be rented from a professional supplier The Cons Of The Electronic Breast Pump These types of pumps are a lot pricier than any manual The electronic pump is far nosier than a manual pump Some electric models can be intricate to sterilize Generally, these pumps are more difficult to transport than a manual If you buy a mains operated pump, you will be reliant on a plug outlet to do your pumping Manual Breast Pumps The manual pump has been around since the late 19th century, first being patented in the States. There is a reason this magical little appliance has endured through the century – even with the introduction of the electronic breast pump.  The Pros Of The Manual Breast Pump Cost effective – this type of pup is far more affordable for the everyday mum The manual pump is light weight and compact, making it easy to carry on the go The manual pump is incredibly quiet to use The pump is also really simple to operate This pump requires no electricity, meaning you can use it any time, any where The Cons Of The Manual Breast Pump This type of pump operates slower than the electronic counterpart Sometimes finding a regular pumping rhythm can be challenging Manual pumping can tire your hands In Conclusion As you can see, both electronic and manual breast pumps have their pros and cons. If you are a mom pressed for time with a bust schedule, your best bet would be to invest in an electronic pump. However, if you’re looking for an affordable, easy t use and transport breast pump, the manual version will serve you just fine! Stand a chance to win a Medela Harmony Manual Pump this month! See our competition page for more now.

April 2, 2019

Bonitas gives back

Members of Bonitas Medical Fund will now have access to free lifestyle vouchers as well as discounted offers on gap cover and financial services products through the Fund’s new multi-insurer platform. This is not another Loyalty programme. ‘Our members’ health has always been a priority and we strive to make healthcare as affordable as possible,’ says Gerhard van Emmenis, Principal Officer of Bonitas. ‘And while our various plans offer a host of benefits, we know that in difficult financial times money matters can add to stress levels.  For this reason, we have adopted a multi-insurer platform which offers members discounted lifestyle vouchers as well as exclusive offers on gap cover and various insurance products.’ The past 12 months have been extremely difficult for consumers, impacted by the increase in VAT, the fuel levy and the resulting escalating prices. This has increased the burden placed on consumers struggling to make ends meet.  ‘In 2017 a Financial Wellness Indicator revealed that 73.5% of South African households were financially unwell,’ says Van Emmenis.  ‘2019 is no different. Consumers are cash strapped so being able to align with strategic partners to offer a comprehensive and tangible way to relieve the money pressure while helping them find them some ‘extra’ money, will go a long way to keeping them physically and financially healthy.’  A report published last year, which reviewed rewards programmes in South Africa, indicated that there are around 100+ existing loyalty programmes with the average consumer subscribed to about nine. ‘The economic landscape is tough to navigate and we didn’t want to add to the pressure already placed on our members by offering a loyalty programme for which they would have to pay an additional monthly fee for. Our multi-insurer platform is premised on negotiating exclusive deals to the benefit of our members.  ‘They are designed to add real value aligned to member needs.’ Van Emmenis explains. In brief: These do not cost anything  There are no points No levels of membership You don’t have to work for rewards The model is split in two.  One: Free monthly discount lifestyle shopping vouchers to offset daily living expenses These are available from over 30 retailers and 6 000 outlets countrywide, such as Shoprite, Takealot and Edgars, as well as for airtime and data purchases and electricity. ‘The deals are aimed at the average South African, with discount vouchers for groceries, data, airtime and electricity. There are also discounts on activewear and gym membership to encourage a healthier lifestyle,’ Van Emmenis says. Two: Discounted financial service products through Medgap and Indie MedGap offers comprehensive gap cover at a discount of up to 26% exclusively for Bonitas members.  Indie offers various financial products such as a funeral, critical illness or disability cover, as well as income protection at a discounted premium, together with a free investment at no extra cost.  Indie will match and invest up to 110% of Bonitas’ member’s life insurance premiums, with cash drops every five years. The multi-insurer platform is supported by a new, revamped member zone to allow members to manage their medical aid 24/7, on any device. This includes submitting claims, applying for chronic medicine and viewing benefits clearly signalling a new era of medical aid has dawned. 

March 2, 2019

Single parenting financial tips

Being a parent is challenging enough, but when you’re doing it solo, you have double the time, financial and resource demands. You’re likely reliant on one income, but still have current expenses and concerns, as well as longer-term considerations such as life insurance and education policies. Single parents have little margin for error when it comes to their finances and we at Hero Life have some practical strategies for balancing present and future financial requirements. Save It sounds so easy, but in practice it’s tough, especially when there are always expenses, a and new ones come up. You need to find ways to save that make sense – whether it’s setting up a debit order on your bank account for a savings plan, only eating takeout once a month, only buying clothes on sale, scouring supermarkets for grocery specials, or packing lunch to take to work. The key to changing spending behaviour is by creating a goal, and starting small. Begin by switching off lights when you don’t need them to save electricity, or waiting a while before buying those shoes, or limiting yourself to one impulse buy a month. You could save hundreds of rands a month, which equates to thousands by the end of the year. This money can be saved for emergencies, or put towards education policies or increased life cover. Create a budget It’s boring and admin-heavy, but by figuring out your fixed and variable expenses, and looking at your bank statements, you’ll see exactly where your money is going, which will help you make smart decisions on what you could cut out of your life. You’ll likely find that you’re spending money on things you don’t need, or you’ll see opportunities where you could be paying less for something. You could also try the 50-20-30 budget method: 50% of your net income should go towards your needs, 30% towards your wants, and 20% to your savings and debt repayments. If you’d like guidance here or don’t know where to start, chat to us at Hero Life – we’ll happily guide you through the process. Protect yourself and your things Having a will, life insurance and medical aid aren’t luxuries. You might think that because you and your family are generally healthy, or that you don’t have a lot of assets, you don’t need medical aid or a will. Or you might think that because you’re fairly young, you don’t need life insurance, or that your kids will be provided for by their dad, or your parents. There are many things to consider if something happens to you – your kids’ education, first cars, weddings and general wellbeing, and you’ll be doing them a big disservice if you leave them with nothing. These things are important, and without them, you could be left with debt, your kids could be left with no assets and lots of debt too, and you could be compromising heavily on your savings and your financial future. If you’re unsure of where to start, or worried about how to afford it everything and how to budget, then chat to us at Hero Life. At Hero Life we’re happily helping young South African families with their finances and pointing them in the right direction. Hero Life is a company that offers a free online Will, helps you to start saving for your kids’ education, and offers life insurance, designed specifically for young parents. Hero Life is an MMI Group initiative, and underwritten by Guardrisk Life Limited (Reg no 1999/013922/06), an authorised Financial Services Provider (FSP license number 76). This material has been prepared for informational purposes only and is not intended to provide financial advice. Visit herolife.co.za for more info or WhatsApp us at +27 73 916 9367 to learn more. Facebook: https://www.facebook.com/herolifeZA/    #BeAHero #SuperSavvy #HeroParents

February 27, 2019

The What-We-Need-To-Breeze-Through-2019 for Busy Parents

You’re a parent. Got any spare time? No? We didn’t think so. Since we know you’re so busy with kids, school homework, school activities, feeding the family, work, home choewa, traffic, playdates and who knows what else, we decided to create a checklist of the tasks we think are most important for you to tackle at the beginning of the year. Let’s get straight to it: Life insurance Estate planning Preparing for end of tax season Start saving Make resolutions you’ll want to keep Holiday shopping for 2019 Life insurance The only sure things in life are: death, taxes and spaghetti sauce all over your son’s brand new white school shirt. All inevitable. And that’s why you need to prepare (for the first two, anyway). First and foremost, consider life insurance, either term or permanent. If you decide that term life insurance is a good fit for you, know that applying for coverage is simple and affordable, and it’s easier than ever to apply for coverage online. There’s really no time like the present.You can even try it out at Hero Life as we’ve designed term cover specifically for busy parents. Think about it. The holidays are over, but you can still provide a loving gift to the people who matter to you the most. What better gift to your family than a safety net that will help your family financially if something were to happen to you? Remember, you won’t be there to take care of them, but your legacy will change their lives fort the better. If you’ve done your parental duty and taken care of this already, great! Now’s a good time to check in and make sure your your policy details are up to date, and that the policy is easily located in case you need it. It’s also not a bad idea to check if your cover is enough.  You can use the Hero Life tool available here for a quick check. Remember, there are lots of reasons why you need to update your cover amount over time — maybe you had another baby or your partner stopped working. It’s a good time to make sure all your affairs are in order. Speaking of… Estate planning If you haven’t written a will yet, make it your goal to get that done in 2019, both to ensure your end-of-life plans are executed according to your wishes and to potentially help your beneficiaries avoid a tax hit in the event something happens to you (translation: in case you die before you plan to).  We have simple online solution that costs you nothing (really!) and you can try it out here. If you do have a will, check in and make sure everything is up to date and as per your wishes, and that your important paperwork is somewhere accessible to you and anyone else who might need it. Preparing for end of tax season In South Africa, tax season closes on the 28th of February every year and there are a few things you can do to ensure you have maximised on some tax incentives granted to you by the Taxman. If you are unsure, this is the time of year to schedule an appointment with your tax advisor. You have a window of time right now when you can contribute a maximum of R33 000 to a Tax-Free Savings account if you haven’t done so already.  If you also haven’t maximised on the tax breaks by contributing to a retirement annuity, you have until the end of February 2019 to put some extra money away which could reduce that tax bill substantially. Don’t have a tax advisor and don’t know where to start? Try out TaxTim as they have a good source of some of the most frequently asked questions. Start saving There are really only two important things to remember when it comes to saving for a goal: don’t save what is left after spending but rather spend what is left after saving AND start saving now as compound interest is truly the 8th wonder of the world. It doesn’t matter what your goal is, whether it is to save up for a deposit on a new home or for your children’s university fund, there is no better time than now.  Most people feel defeated before they even start as sometimes it just seems unattainable, but even if you start with only a small amount, JUST START. And if you need a bit of help, check this out. Make resolutions you’ll want to keep Look, we all know the reasons to get (or stay) healthy: You’ll live longer, live better, and you might even save money on your life insurance policy with some insurers. If you’re looking for specific things you can do right away as we begin 2019, consider these: – Go for a medical check-up – Quit smoking (again!) – Walk at least 30 minutes a day instead of watching Netflix – Reduce your alcohol intake – Make meals at home Start with small incremental goals and work your way up. Each of these will have an outsized impact on your health and happiness. Check in on your casa Houses and apartments, like the people who live in them, age. Some more gracefully than others. This is a good time of year to check in on things like air filters and smoke alarms. Consider setting seasonal calendar reminders in a shared calendar that you and your spouse have access to. Holiday shopping for 2019 Sorry. Too soon? 😉 Hero Life is a company that offers a free online Will, helps you to start saving for your kids’ education, and offers life insurance, designed specifically for young parents. Hero Life is an MMI Group initiative, and underwritten by Guardrisk Life Limited (Reg no 1999/013922/06), an authorised Financial Services Provider (FSP license number 76). This material has been prepared for informational purposes only and is not intended to provide financial advice. Visit herolife.co.za for

February 14, 2019

Financial planning tips for parents

School holidays are long gone and the reality of live is slowly but surely setting in.  Janu-worry is long month and we are all feeling it in our pockets! Well, this is the best time to start planning for your healthy financial year that is 2019.  So use the opportunity to see if you could be doing better on the financial front, and look at ways to improve. This month, family financial experts Hero Life answer the questions their clients often ask them about financial planning, plus how to get started, and make the best of it. I really want to get started sorting things out in this new year. But is it a good idea to start now?   The beginning of the year is a great reminder to take a few small steps to help improve your financial health and make better money management decisions going forward. With the holiday season, and all it’s associated expenses, being something of the past, there’s no better time than now to get your finances in order for the year ahead. How do I get started with my financial planning? You can start with six easy steps: Step 1: Take a financial inventory (your “original” so to speak). That is see how much you earn, what you spend, on what do you spend your money, your debt situation, your life cover situation as well as savings and retirements. Basically just listing everything you have currently in place. Step 2: Think a bit about what you want to achieve financially for 2019 and what those family goals are (your destination). These could be things like buying a house in five years, or going on an overseas holiday. Or maybe you just want to be financially independent without any debt in 10 years from now. Step 3: Create a budget that will make you reach your goals (basically the map showing you how to go from your origin to your end destination). And commit to reduce your spending and increase your income. Step 4: Categorise your goals and fund these goals with any surplus you have left after you essential living costs every month. This could be e.g. paying off debt sooner, putting more money away for retirement or even just something as simple as starting an emergency fund. Step 5: Look at ways of increasing your income or decreasing your expense to allow for extra surplus every month to fund the goals you have set for yourself. Step 6: Take a moment and celebrate your progress! Beginner financial planning really comes down to just a few basic steps – earn more, spend less and save in a way that aligns with your financial goals. And remember, if at any time you feel you need a bit of push, there are always professionals available to give you a hand. Why is a budget so important when it comes to financial planning? It’s boring and admin-heavy, but by figuring out your fixed and variable expenses, and looking at your bank statements, you’ll see exactly where your money is going which will help you make smart decisions on what you could cut out of your life. You’ll likely find that you’re spending money on things you don’t really need, or you’ll see opportunities where you could be paying less for something. You could also try the 50-20-30 budget method: 50% of your net income should go towards your needs, 30% towards your wants, and 20% to your savings and debt repayments.  I have kids, so I feel it might be more important to budget and save. Is this so, even though I have more responsibilities? Absolutely – it’s very important, no matter your expenses or number of dependents. We know that the concept of saving sounds easy, but in practice it’s tough out there, especially when there are always living expenses and new ones coming up, especially when you have children. You need to find ways to save that make sense – whether it’s setting up a debit order on your bank account for a savings plan, only eating takeout once a month, only buying clothes on sale, scouring supermarkets for grocery specials, or packing lunch to take to work. The key to changing spending behaviour is to create a goal, and start small. Begin by switching off lights when you don’t need them to save electricity, or waiting a while before buying those shoes, or limiting yourself to one impulse buy a month. You could save hundreds of rands a month, which equates to thousands by the end of the year. This money can be saved for emergencies, help with expenses for unforeseen expenses, or put towards education policies or increased life cover. What else should be part of my financial plan? Your financial plan should ideally cover every aspect of your finances: savings and investment, insurance (life, short term and medical), managing debt, estate planning, tax planning and retirement planning. For a parent, having a will, life insurance, and savings for their kids’ education is a critical part of a financial plan. You might think that you’ll be able to afford your child’s university expenses from your monthly cash flow, or that you don’t need a will because you don’t have a lot of assets. You might also think that because you’re fairly young, you don’t need life insurance, or that your kids will be provided for by their dad, or your parents when you’re no longer there. This isn’t the case and there are many things to consider – your kids’ education, first cars, weddings and general wellbeing. You’ll  be doing them and your partner a big disservice if you don’t plan properly to secure any dreams you have for them. Once I have things in place, what next? Do I always need to change and re-evaluate things? As they say, the only constant in life is change. Your life and circumstances are definitely going to change over the next 12 months.

January 21, 2019

4 Mistakes couples make about money

The reality is that finances, if not properly managed and understood by each partner, can be a major source of tension in any relationship, and financial stress is one of the leading causes of relationship breakdowns. Have you been postponing the money talk? Feel a bit uncomfortable talking it? It’s probably better to rather talk about it earlier. You don’t have to open a joint bank account if you’re not ready, but you do need to learn how to manage money jointly once you start sharing expenses. When kids join the picture, this quickly becomes very important. Sometimes it’s easier to learn from other people’s mistakes, so take a look at these common errors made by couples over money. 1. Skipping the Household Budget When you’re busy and have 1000 things to do, it is easy to just skip the money conversation. Being busy with work, home projects and the kids it is easy to become distracted and can lead to some dismal days at the end of the month, like, say, running out of money for rent. There are a lot of ways to do it, from splitting every expense down the middle to dividing up the bills by expense (I’ll take the utilities; you take the groceries) or proportionally (I make more, so I’ll pay 70% of the bills and you pay 30%). The method you choose isn’t as important as the act of sharing responsibilities and deciding who’s in charge of what. If you haven’t had the conversation yet, don’t worry rather late than never. 2. Not Communicating About Your Cash Ever notice how the biggest fights often start because you push off actually talking about an issue and then it just explodes? Money works like that, too. If you’re swimming along without regularly checking in about money, you’re likely in for an unpleasant surprise eventually. No – that 30-second conversation, in which you observed that “it seems like we’re doing fine” – does not count as checking in. If you don’t think spending R1500 on gadgets in one month is reasonable but your partner does, you’d better raise that as soon as possible. And if you share a bank account, you both should normally know about how much is in there to avoid getting into trouble with an overdraft. We suggest touching base at least once a month, but ideally, once a week. If you’re talking money often, the discussions can be quick and less painful overall. 3. Not Having a Common Goal Couples that save together stay together. You’ll feel a real sense of accomplishment as a couple if you both contribute to a common cause, whether it’s a weekend getaway, a new car, or a down payment on a house. You don’t necessarily have to contribute equally if one of you is a stockbroker and the other a barista, but make sure the contributions feel fair. It is important that both feel responsible for achieving the goals you both agreed on otherwise, it can quickly feel like the one person only spends money and the other needs to worry where it comes from. Having a savings goal also ramps up the pressure to save faster – and that’s all for the good.  4. Modelling your relationship after your parents’ relationship We are different people in a different time. You need to figure out what works for you. It is easy to think that their only exists two options to earn money in a relationship. The first option is that one partner takes the lead role and earns money, while the other partner raises the kids. If that’s not an option then traditionally both want or need to work and kids don’t really fit into that lifestyle. There are two other options. Either you could alternate between taking the lead and raising the kids or you and your partner could work together. The alternating option gives both parents the chance to have a huge impact on their kids’ childhood and have a career. The complementary option does, however, require the partners to have complementary skills. Think a designer and a web developer. Or an architect and a quantity surveyor. The point is that there are other options and it takes some thinking a purposeful design to get to a lifestyle that will work for both parents. The earlier you and your partner can form a shared understanding of, and commitment to, your future goals and objectives, the better off you’ll both be. Hero Life is a company that offers a free online Will, helps you to start saving for your kids’ education, and offers life insurance, designed specifically for young parents. Hero Life is an MMI Group initiative, and underwritten by Guardrisk Life Limited (Reg no 1999/013922/06), an authorised Financial Services Provider (FSP license number 76). Visit herolife.co.za for more info or WhatsApp us at +27 73 916 9367 to learn more. Facebook: https://www.facebook.com/herolifeZA/    #BeAHero #SuperSavvy #HeroParents

January 7, 2019

A poem for Christmas

I had a friend who had alot,  And very happy she was not. Then she lost it all one day,  And now she morns her life away.   I have never had a lot,  And ofte’ it’s left me in a spot,  But I am sure with banking clout,  Wonderful happiness would find me out.   But in memories, it’s the times without,  That warm my heart and stand right out. Mayhaps happiness has more to do,  With the life you live, than what have you.  By Teresa Dearing   Wishing you all the best that this holiday season can offer – peace, joy and love with your family. And remember, it’s the experiences that matter, not the stuff.   Happy Xmas from Hero Life.   Hero Life is a company that offers a free online Will, helps you to start saving for your kids’ education, and offers life insurance, designed specifically for young parents. Hero Life is an MMI Group initiative, and underwritten by Guardrisk Life Limited (Reg no 1999/013922/06), an authorised Financial Services Provider (FSP license number 76). Visit herolife.co.za for more info or WhatsApp us at +27 73 916 9367 to learn more. Facebook: https://www.facebook.com/herolifeZA/    #BeAHero #SuperSavvy #HeroParents

December 19, 2018

Smart and practical gifting ideas for this holiday season

You’ve made that gift list and checked it twice … and you just can’t see how on earth you will be able to afford it this season. You are literally wishing that Santa could swoop in with his sleigh of toys to help provide for the friends, your family, and your coworkers who expect something from you. And yes, a credit card could solve all of your problems, but for now only – you will get nasty surprise in January and probably end up paying off the Christmas debt well into March. But instead of pulling out that nasty credit card or raiding the closet for re-gifts (scented candle and bubble bath anyone?), you have a few other options. You probably don’t realise it,  but the people on your list might be just as relieved as you to do away with a gift exchange, and these ideas below can really help in finding meaningful ways to bond, celebrate your friendships, and even give back to others without having to go into debt. Non-material gifts for family For young kids, wrapped presents can be a really important part of their holiday (the expectation is there!), but there’s no need to give that up. But minimising material gifts can really help your family save money and rather spend quality time together. Children will remember the experiences you create whilst on holidays more than what they will remember about the presents they got. Just think back to when you were a child – do you remember the presents or the moments? It’s not unheard of these days where parents find it easier to make a mutual decision to her ratskip gifting each other presents, saving the money for either a family goal (pay off a little bit more on your house or reducing that expensive short term debt) or a family experience. And while you may find yourself buying a few small material presents for young kids, getting them excited about an experience (the present that can’t be wrapped and put under the tree) can help them begin to understand the value of family time and experiences rather than things. A coupon book A homemade coupon book is classic homemade gift for a reason! Building a coupon book for each child (or your partner) to cash in throughout the year lets them know how much you treasure the unique bond you have. These “goods” can be as simple as baking cookies together, have movie night with popcorn and pizzas, control of the TV control for a weekend, or bedtime two hours later than usual. Not only can these be fun to use throughout the year they can also help you find those experiences and special time spend with each child. A plan for organising family photos, documents, and memories If you’re stumped for gifts for extended family, conquering old photo albums and documents is a huge undertaking that everyone would appreciate. Taking the lead on deciding how and where photos and mementos should be kept, organized, and distributed, or setting up a virtual cloud of family photos for distribution, is a really big gift. Instead of exchanging gifts, family members can come together with items related to the history of the family and then throughout the year, various people can take the lead on organising and distributing them. Non-material gifts for friends and coworkers Gift exchanges between friends can become difficult and not to mention, pricey. Not only that, but a candle here, a mug there, and it’s all too easy for a gift exchange to feel like you’re simply swapping through the same boring presents. This year, instead of gifts, propose these options: Take something off their to-do list: From cleaning the house to putting air in tires, to picking up kids from school, one person’s dreaded chore or procrastination is another person’s No Big Deal! This year, make a plan to exchange dreaded to-do list items, with the idea that everyone will get something they truly need and value — and have been putting off for way too long. To make the process fair, add some guardrails, like time limitations.  Contribute to a shared gift: If you work with a tight group of coworkers, suggest everyone pitch in R50 for an epic sweets and chocolates drawer. If you and your friend always get together for a drink, consider chipping in and sharing a wine or beer of the month club. The idea here is to think of potential gifts-that-keeps-on-giving that can benefit all, and also offer an excuse to get together. Write a note of appreciation: If your usual office or friend holiday gathering includes a gift exchange, suggest that this year, you each take the time to write a short note or a poem about what the other person has done this past year that you admire or appreciate. It doesn’t need to be elaborate. Taking the time to reflect on how important a person is to you, or even just how amazing their Google Sheets skills are, can be a great (and memorable) way to bond without breaking the bank. Start the conversation surrounding gifts now Of course, you should still give presents if you want to — but if this becomes stressful and anxiety filled, then it may be time to speak up that this year you would like to do things differently. Trust us, you will be surprised in how many of your family, friends and co-workers will support you. It’s difficult out there for everyone! By prioritizing relationships and experiences rather than things, you’re setting the stage for plenty of memories and laughter. You might be saying what others are thinking. Putting this idea out there can ensure that everyone’s on the same page without any awkwardness or resentment— or unwanted bubble bath. Hero Life is a company that offers a free online Will, helps you to start saving for your kids’ education, and offers life insurance, designed specifically for young parents. Hero Life is

December 4, 2018

Teaching your kids about money

We previously touched on how, as a parent, we need to get our thinking right when it comes to money. A lot of us grew up with a weird attitude towards money, often about not having enough and wanting more. We become jealous of those who we perceive to have it all and we focus on what we think we need to keep up with the Jones’s. Sometimes we feel shame for what we have compared to others, but sometimes also shame for what we didn’t have. When we become parents, we have the golden opportunity to teach our kids to think differently about money from the get go.  We have the opportunity to undo the wrong and uncomfortable attitudes we had (and might still have) around money. Here are tips to create a healthy, balanced attitude towards money in your family’s life and your kids upbringing. Pocket-money is a money management tool By letting your kids help with family chores (washing dishes, feeding the dogs, making beds, cleaning the braai and setting tables), you are helping you kids to understand the necessary tasks of daily life – not because they are going to get rewarded for it. We are doing it to help our kids to learn life skills along the way.  Why should it be any different when it comes to money managed? Introduce money management with your kids by giving them weekly or monthly pocket money and let them save it and spend it the way they want. Be it on the Google Play Store for the hippest apps or on that extra data for the month. They will quickly learn the lesson of overspending or buying things that only gives them a limited time of fun and pleasure. Don’t be tempted to ‘top-up’ their pocket money for the rest of the month. Gratitude comes in the form of paying bills Paying bills doesn’t have to be this negative thing we usually don’t want to deal with.  Involve your children by teaching them that bills are actually just reflections of pleasures already enjoyed. “Thank you Escom for keeping us warm in winter” and “Thank you Netflix for the entertainment”. “Thank you cellphone for connecting me to the world of games and chats with my friends”.  Sharing this attitude with your kids teaches them that everything we consume is actually an exchange of goods and services for money. You can go as far as involving them in the payment process as this is  another incredible way to teach a valuable life skill. Ask them to help you find the amount owed on the bill, who it should be paid to and for what services or goods. Let them circle the amount to be paid and write “paid” on the bill before filing it away. They will love the process but more importantly, learn valuable lessons while having fun. Sharing is Caring It’s so easy to to get caught up in the attitude of “we might not have enough,” and the feeling of “ and what we have, we have to keep for ourselves”. This attitude needs changing. We should become more conscious of sharing what we have, and by doing that we are contributing to the greater good. When we show our kids to be generous (via donations, volunteering, helping other friends or families in hard times, tipping a water or the petrol attendant), we are teaching them how good it feels to give. Anytime we do good for its own sake, we are modelling how to be a good human, and how to live with the sense that we are all connected, and we are very fortunate. That attitude alone sets our kids up to be appreciative for what they have, and to create more of it as they grow up. Happiness doesn’t come from overconsumption We live in a society overwhelmed with commercialism and in which more is never enough. As parents, we are tempted on a daily basis to give our kids everything they want, and replace it when it breaks. But really, think of the things that are dearest to you and you will be surprised in how often they are not things, but experiences. And if they re things: chances are they are things you worked really hard for and have a sense that you earned them. Buying your child everything they want and catering to their every whim does not raise happy children – it raises children who have a false sense of entitlement and reality. You will be raising children who tend to develop anxiety in later years when they realise that things rarely fall magically into their lap without their own hard work and hustle. Teach them to appreciate what they have, with modesty and without entitlement. Wealth is a state of mind Thinking rich is essential to living a rich life. Constantly living in the fear-based state of never having enough instills a fearful mindset in young children that they will carry forward with them, and have to un-do later. “We can’t afford that, we could never go on that vacation, that’s only for rich people.” All of that language creates a false reality that money is only for a selected few, and if you don’t have it, you never will. In reality, anything is possible – anything. And we can teach our kids to use that lens by involving them in planning and dreaming. Always wanted to go to Mauritius and stay at a family resort? Start a family vision board for that trip. Look up cool places to stay & airlines to use. Involve your kids in using some of their own savings (from the pocket money) to put towards the trip. Make them feel a part of it – and give them the sense that they have ownership in making it happen. This is a hugely empowering pattern of thinking and behaving; much healthier than the attitude that “that’s not for us.” Remember: our children

November 29, 2018
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