Leaving finances up to chance instead of planning ahead will cost you. Rather, look at these five ways being organised can save money.
We know that procrastination and lack of planning are bad habits - but we usually leave changing them up to our future selves.Being organized can, however, actually save you money. This might be the push we need to actually put on our grown adult hats and start planning.Here are several ways being organized can save you money:
1. Managing Debt to Prevent Extra Interest
It may seem harmless to leave your credit card balance higher than usual and let it carry over for some months, but do it enough and you'll be losing quite a bit of money to extra interest.Furthermore, if you miss the minimum monthly payment, you will be charged a penalty by the bank along with the higher interest amount.How much can this cost you? It depends on the bank. Standard Bank will charge customers R130 for a payment which is five days late. Their arrears fee for 60 days of non-payment is R55. There is also a R145 honouring fee.Meanwhile, Nedbank's credit card "dishonored payment due to insufficient funds" penalty is R90.It can be difficult to figure out exactly how much you will be penalized by the bank for missing your credit repayment - so it's better to avoid dishonoring the payments in the first place.Budgeting for credit card payments ahead of time will save you this hassle. Meanwhile, paying off the balance completely can save you from interest altogether.Some banks offer credit cards with interest-free periods, meaning that if you pay your balance within a certain time-frame, you won't be charged any interest.For example, Nedbank and FNB's standard credit cards offer up to 55 days of interest-free credit.
2. Monitoring Your Calendar to Save Money
Keeping track of various financial obligations and policies throughout the year can go a long way towards saving you some extra cash.
Tax And Policies
For example, making sure that you are aware of tax filing deadlines will prevent you from being caught off guard and possibly filing late.You should also know the dates for the renewal of certain policies, such as your car insurance. Renewing your policy, rather than letting it lapse, will help you qualify for loyalty discounts and lower premiums.However, allowing these policies to lapse means you will lose out on claim-free and loyalty discounts.
Monthly Debit Orders
The same applies to certain subscriptions. If you let your DSTV subscription lapse due to non-payment, you will be charged a reconnection fee each time you resume the service. This fee is R50 for regular customers and R10 for EasyView customers.Some mobile operators also charge reconnection fees after disconnecting your number due to non-payment or a canceled contract. The same applies to multiple internet providers. These fees vary from company to company.Vodacom's T's&C's outline the right of the company to charge a "reasonable reconnection fee" of R10. Meanwhile, depending on the conditions around the suspension of your account, Afrihost charges up to R400 for reconnection.
MTN charges R75 to lift a suspension and R95 to reconnect you to the network.
Schedule Your Car License Renewal
There are also a series of deadlines in most consumers' lives which, if not met, can cause you to rack up fines.Missing the deadline for renewing your car license is one of the heftier fines you can face. After the 21-day grace period is up, you are penalized 1/10th of the annual fee for every month the renewal is late. Plus, if a traffic officer sees your expired license disc on your car, that is an immediate R500 fine.
3. Know When Sales Periods Are
During certain periods of the year, the retail sector launches sales that you can count on to happen. Depending on what you want to purchase, waiting for scheduled sales can end up saving you a lot of money.When it comes to clothing, end-of-season sales often offer great discounts. If you care about budgeting more than keeping up with seasonal trends, doing your winter shopping at the beginning of summer and vice versa saves you quite a bit.In terms of electronics, many people looking to buy something in the latter half of the year usually wait for Black Friday and Cyber Monday. The trend is still catching on in South Africa, but more retailers are getting on board.
4. Long-Term Planning for Buying Large Assets
There are certain purchases that most people make at different life stages - such as your first house, your first car or other costly assets.Some purchases you know will eventually be inevitable. For example, getting a new car in the next few years due to yours getting too old.As a result, you should rather plan ahead.Saving as much as possible for these purchases means you have to take out smaller loans. This saves you thousands in interest.
Let's Make This Practical
Considering interest means that many people pay for their house up to three times over, imagine how much R100 000 off your loan amount saves in the long run.We did some calculations using Ooba.co.za to find out just how much you can save.For a R2-million house, you will end up paying a total of just over R4.5-million over 20 years. This is at the current interest rate if your deposit is R100 000.Change that deposit to R150 000, with all the other variables remaining the same, and total payment decreases by over R100 000.With a R200 000 deposit, you pay around R240 000 less over the 20 year period. Therefore even just saving up an extra R50 000 for your deposit will save you over double that amount.Saving that amount is no easy feat, but if you plan years in advance you can create a decent deposit.
5. Write Up and Stick To Your Grocery List
Not planning your shopping list ahead of time and just picking up items as you see them can quickly result in overspending.Picture entering The Crazy Store to look for a toy for your beloved cat. Your browsing through "discounted" items might result in you coming home with a vase, a miniature fountain and some storage containers instead (based on a true story).This gets even worse when you buy groceries without creating a list to stick to. We all also know the famous scenario, I walked into the supermarket hungry, and am now the proud owner of aisle four. This is a real thing!Our advice:
Make sure you have eaten before you walk into any store.
Have a basic list of what you want to purchase
Shop for items on special at all times. Make sure you know what stores have specials on the monthly goodies you need! If you can get coffee at R79, instead of the normal R140, grab two! You will thank yourself next month!
Make use of coupons and saving apps like SnapnSave, you could get back R300 cash every month!