To save or not to save

So often we meet clients who tell us that they cannot afford to save because ‘school fees are really expensive’ and ‘looking after family members is derailing their savings goal’….and the list of reasons is endless. If we are really honest, life has changed dramatically in the past year and a bit. Things are not as black and white as they have been, and we cannot continue living as if death and financial insecurity is not a part of our lives.

Many of us are experiencing anxiety and real fear about our immediate and long term wellbeing and we cannot brush that aside. If this is you, know that you’re not alone in all of this. And your fear and stress are justified.

While we are trying to keep our heads above water, we need to consider a few things. In the event that we make it through the next week or year or decade, what will our financial situation look like? In the event that we make it to retirement, will we be able to sustain ourselves on what we have saved over the years? Current statistics suggest that we won’t as only approximately 6% of retirees in our country are financially secure. The rest are either forced to continue working or are dependent on family or the state for their survival. While our mortality may be in question, our survival is also very likely and we must try our best to plan effectively for it, if it happens.

So what can we do today to try and better our situations, given the mess the world is in right now?

Here are a few pointers that may help:

  1. The first and really important step is to acknowledge your feelings. It’s ok to be feel the way you do. Be gentle with yourself because this is really a difficult time we’re in
  2. Be honest about your spending habits. Many people think they know how they spend but don’t really. When we work with clients, we almost always find money they had no idea they had, simply because they don’t really keep track of every cent they spend. If you do anything in the next few weeks regarding your finances, understand where your money goes – ALL of it. You’d be surprised at what you discover during that process
  3. TALK. Talk to your spouse, your children, your extended family members that you support – talk to them about money. Talk about what you have, what is possible and what is not. A lot of anxiety and financial strain can be alleviated through honest conversations. Try it

Once you’ve done all the above, you may discover that it is possible to start your savings/investment journey. Even if it’s with very little money. But the important thing is that you actually start. With time, and we see this often with clients, you gain momentum and are encouraged by the balance you build up which then gives you the desire and willpower to continue to accumulate more. Remember that there are two important ingredients of wealth accumulation and that is starting early and consistency. Both are in your control.

Be well.

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