#CrazyWaysToSave: Money tips from ordinary South Africans

#CrazyWaysToSave: Money tips from ordinary South AfricansAs part of the launch for Savings Month in July, the South African Savings Institute asked South Africans to share the crazy ways they save. Here are some great ideas.

Kgomotso uses the Standard Bank Stash app to save into a tax-free savings account. Stash is an app available to anyone through Google Play or Apple’s App Store ‒ you don’t have to bank with Standard Bank. You link your credit or debit card to the app and every time you spend on the card, you can select to have R5, R10 or even R50 immediately transferred to a zero-fee tax-free savings account. The money is invested in a fund that tracks the performance of the 100 largest companies in South Africa. It’s a great way to turn spending into saving.

Monique found that sticking to her grocery budget was a challenge, so she now transfers her grocery money into a TymeBank account and only uses that to buy groceries. She also benefits from the double Smart Shopper Rewards at PicknPay which you receive when you use a TymeBank card to pay for purchases.

Nonhlanhla has a debit order that goes straight into a 32-day notice account where she saves up to pay for furniture or do house renovations. She only ever spends cash, not credit, and doesn’t touch the money for six months at a time. With such easy access to credit many of us have forgotten what it is like to save for something rather than use your credit cards. By having a debit order in place, Nonhlanhla also makes sure her savings are prioritised before spending.

Andile plays the clothing retailers at their own game. He waits until there are great sales of 50% off before he buys. He then uses the 6-month interest free period on his clothing account to pay it off. This is a great way to avoid paying interest, and keep the money in your bank account, but it requires discipline. Never opt for the 12-month interest charging account and always meet your payments on time.

Shirin uses a piggybank to save all her silver coins. This is one of those really simple but effective savings strategies. Did you know that if you fill a 2L coke bottle with R2 coins it adds up to R3 000! If you stick to R5 coins you could have R5 000 saved.

Joy uses her Nedbank Greenback rewards to invest in unit trusts. Usually we use our loyalty rewards for spending, but it can create the perfect opportunity to start investing. Find out if any of your reward programmes offer investment options.

Amanda committed herself to the 52-week savings challenge. In this challenge you start by saving R10 a week and each week you increase it by another R10. For example, in week one, you save R10, week two R20 – and then by week 20 you would be saving R200 a week. It gets tougher as the numbers climb, but it is a great way to gradually start saving.

Nosivatho saves 35% of her income each month which she divides into various buckets. She puts money into a retirement annuity, belongs to a stokvel that pays out in January for school fees and another that pays out in turns during the year. She also has a dedicated savings account for her car deposit and keeps her change in a piggybank. What is great about this approach is that Nosivatho is saving for specific needs – so each rand has a goal. There’s her long-term need for retirement as well as her shorter-term need for school fees and planning for that new car.

Finally, many of our respondents said they bought grocery vouchers each month to save for the end-of-year festive season or kept their loyalty rewards for that big December month. Planning for the end of the year is a great way to protect yourself from going into debt during that festive-season spending frenzy.

31-day frugal challenge

Can you survive being a miser for the whole of July? Sanlam is challenging consumers to live their most frugal life for 31 days. Master being a miser by partaking in Sanlam’s 31-day frugal challenge: 31 days of ways to be your best, most financially savvy self.

Andre Wentzel, Solutions Manager at Sanlam says frugality is not a new concept. It’s something commonly associated with our grandparents and the money-under-the-mattress scenario. Wentzel says it’s great to adopt this mindset but rather invest money in savings vehicles that can grow this money. “Come up with granular savings goals – like saving for your child’s education and a holiday overseas. Having goals makes it easier to be frugal because you have tangible milestones you commit to saving more for. Decide how much you need to save in total and what your monthly contributions will be. And then pick a savings vehicle that matches each goal. Set up debit orders so you always pay yourself first.”

These suggestions have been crowdsourced from young, savvy South Africans already doing more to manage their money better:

  1. Carpool! It’s been said time and again, but few of us have actually got around to consistently carpooling with colleagues. Now’s a great time to gather a carpool crew and share the costs of fuel. Or investigate viable public transport options together. Of course, other solutions to cut down on ‘petrol poverty’ include ‘work from home’ days and virtual meetings via platforms such as Zoom and Skype.
  2. Say goodbye to expensive bank charges: This is a super simple way to immediately save some moolah. Check what you’re paying in monthly bank fees and investigate whether you are on the right account option. Do you make use of all the benefits offered on that option? If not, change to a more affordable account option and save on banking fees.
  3. Get smart with your geyser: Geysers use an astonishing amount of electricity each month. So, lower the thermostat on your geyser to cut down on costs ‒ though no lower than 60 degrees for health reasons.
  4. Have a ‘clothes swapping’ party: Gather together friends or colleagues and arrange to have a clothes swap. The rule is you can only take someone else’s clothes if you contribute two or three of your own good-quality items to swap. So share, and get a new wardrobe for free!
  5. Stage a garage sale: Watch a Feng Shui video on de-cluttering on YouTube. Once you’re suitably inspired, go through your home and find all the furniture and items that no longer bring you joy. Have a mini garage sale or sell these on Facebook Marketplace or an equivalent platform.
  6. Negotiate cash discounts: Never be afraid to negotiate. A little-known fact is that most doctors and dentists are actually willing to give significant discounts if you can pay in cash, for example.
  7. Eat in: Have ‘One Favourite Dish’ potluck meals with loved ones. Ask everyone to bring a favourite dish to share – if you end up with three puddings and one starter, that’s just a delicious advantage. On the topic of eating in, planning more vegetarian meals is also usually a great way to save money.
  8. Get serious about data: Install a data manager app to manage data use. Turn off all automatic app updates on your phone to consume less data. South Africa still has some of the world’s highest data fees so this is an essential one to consider.
  9. Join a loyalty programme: Loyalty programmes can sometimes save you a considerable sum. Do the maths and carefully weigh up what joining costs you and what you gain in exchange.
  10. If it’s broken, fix it: We often just throw things out when they break, because of the effort and time involved in fixing them. Next time try to fix something yourself if you can – otherwise, get a quote from a professional. Even something as simple as a pair of shoes – re-sole well-loved boots, for example, rather than getting a brand-new pair.

This article first appeared in City Press.

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