FROM THE EDITOR

INVESTMENT guru Warren Buffett says you should spend what is left after saving instead of saving what’s left after spending. But this is easier said than done. If you’re struggling to make ends meet each month, it is almost impossible to follow this advice, because everyone needs to spend on essentials such as food and accommodation, and these essentials alone may be gobbling up all your income.

However, if you’re struggling to make ends meet because most of your income is going into servicing debt, then you probably can afford to save. This is because much of what you are paying off on your debts is interest. Put another way, it's the ”fee” the bank or credit provider is charging you for borrowing the money, and all it’s doing is making the bank richer and you poorer. So if you reduce your debt, you reduce how much the bank is profiting from you, releasing some much-needed free cash.

July is Savings Month, an annual initiative of the South African Savings Institute (SASI). Many of the large financial institutions take the opportunity to encourage South Africans to save more (we’re pretty hopeless at this compared to some other countries – see page 13).

Why don’t you use the opportunity to try to cut down on non-essential expenses (there are a few ideas on pages 3 & 4) and use what you can save to reduce your debt and to begin putting away something each month, even if it’s only a few hundred rands?

For details on what SASI is doing to promote saving, go to https://waystosave.co.za/

Martin Hesse

A bargain ain’t a bargain unless it’s something you need.

– SIDNEY CARROLL American film and television screenwriter