An alarming number of South Africans desperately need to start living within their means in light of the current economic reality, says Momentum Investments.<\/p>\n
The latest Momentum Unisa Household Financial Wellness Index revealed that South Africans spend more than they earn monthly.<\/p>\n
According to the index, almost 70% of financially distressed households find it difficult to cover monthly expenses and pay bills.<\/p>\n
“Shockingly, even financially well households find it difficult to pay their bills and debt,” said the group.<\/p>\n
Bertie Nel from Momentum said that growing inflation and increased interest rates put consumers under pressure and make achieving financial goals more difficult.<\/p>\n
He said, however, during trying times such as now, it is more important that financial goals are kept front of mind.<\/p>\n
Nel provided the following four indicators that you are living outside your means:<\/p>\n
Your credit balances are increasing<\/strong><\/p>\n Momentum noted that only paying the minimum payments due on your credit agreements and taking longer to pay off these agreements usually indicates a problem.<\/p>\n Nel said you should only buy what you can afford and avoid credit altogether.<\/p>\n “Don’t forget that rising interest rates will take a toll on your credit repayments, and you never know what may befall your financial situation.”<\/p>\n “You don’t want to be left with debt and no way to pay it off,” he added.<\/p>\n You don’t have money left at the end of the month<\/strong><\/p>\n Not having sufficient money left at the end of the month is the first indicator of poor financial planning and indicates that you are living paycheck to paycheck.<\/p>\n Momentum said you need to constantly re-evaluate your budget and understand how the money coming in is distributed to aid your financial plan.<\/p>\n You don’t set a budget<\/strong><\/p>\n A budget is the backbone of financial health, said Nel.<\/p>\n “Budgets should be divided into high-priority expenses, including rent or bonds, life insurance, and debt, and low-priority expenses, like entertainment and subscriptions,” he said.<\/p>\n You want to “keep up with the Joneses”<\/strong><\/p>\n If your buying choices are influenced (or even dictated by) your need and desire to fit in or “outshine” others, you are most likely living beyond your means, said Nel.<\/p>\n “You should only make purchases and enter contracts that suit your pocket, not your social media profile.”<\/p>\n Read: 1<\/a>0 biggest lotto payouts in South African history<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" Momentum outlines four major indicators of poor financial management in South Africa.<\/p>\n","protected":false},"author":10,"featured_media":655299,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[26,6652],"class_list":["post-662167","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-headline","tag-momentum"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/662167","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=662167"}],"version-history":[{"count":10,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/662167\/revisions"}],"predecessor-version":[{"id":664049,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/662167\/revisions\/664049"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/655299"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=662167"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=662167"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=662167"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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