The new year brings with it a fresh start. Let this apply in 2020 with your financial goals and well-being. Here are six ways to financially detox this year
A financial detox is a ‘type of a cleanse’ that will guide you to get rid of those unwanted spending habits and will help you develop sound spending habits. It forms the basis of all financial life’s disciplines and will leave you feeling emotionally lighter. Sometimes our conscience gets the better of us, especially when we overspend or splurge on items that we don’t actually need. Detoxing yourself financially will help you ascertain what your ‘needs’, ‘wants’ and ‘requirements’ are. And will be your stepping stone to financial stability and freedom. Here are six ways to financially detox:
- Start with a plan
Plan your year with a detailed calendar. Highlight where and what you will be doing, get the estimated costs. This will give you an idea of where you need to budget and limit your spending. Also remember that you will need to save a bit extra to cover some annual expenses, like school camps for kids or new tyres on the car.
- Update your budgets
If you don’t have a budget, it would be a great to start one now. Besides daily household costs, your budget should hold your entertainment, wardrobe, holiday and any emergency expenses. It’s your ultimate blueprint that will help guide you through each month and year.
- Goal-based mindset
Fuelling your budgets is a well-defined goal-set. Your short or long-term goals will help you determine how much you need to budget for each goal.
- Get help if needed
There is nothing wrong with asking for help. If you are unsure seek help from a professional financial advisor who will guide and put you on the right path. They can also assist you to stick to the goals that you have identified.
- Spend in the right places
A financial detox doesn’t mean that you should stop spoiling yourself. Spend on the things that you need and spoil yourself now and then. It’s good for your soul!
- Review and refresh
Look at your budget and track what and how you have spent. This will give you an idea of where and what you need to cut back on and what you need to focus on.
Words: Ester Ochse, FNB Head of Product Money Management.