Decide on a figure - I want to save R100 every month, for example
Shop around for the best offers available in terms of
minimum returns you can get:
- Important to consider interest rate, if you are going with
a fixed term savings account
- Important to consider the fees, if you are going with a
Retirement Annuity or buying unit trusts with the help of a brokerage firm
- Important to consider your will power as it will determine
if you should go it alone or join a savings group that will help you stay on
track as you avoid disappointing them by skipping on your savings.
You only need one other person who will keep you accountable
to stay the course, and it cannot just be anyone, it must be someone you
respect and would not want to disappoint
- What my friends & I did was we opened an account which
had joint signatories and when we contributed, we sent proof of our
contributions every month to the one we had elected to keep track of the
contributions and every month this person would broadcast to the group a
spreadsheet showing each person’s payment and the date they made it
Select the vehicle that will help you stick to your savings,
based on what you have determined your will power to be:
- buy a unit trust and pay via debit order, the D/O will keep
you honest
- Open a fixed term savings account and pay via stop order/recurring
payment, the S/O or R/P will keep you honest
- Open a share trading account, transfer your savings,
select what equity to invest in based on your investment strategy, and make
that buy transaction. Your willpower needs to be strong for this one but you
can use the recurring payment/stop order to transfer/pay into your trading
account, but the implementation of the rest of the steps will be based on your
due diligence and not wavering, but revising based on objective analysis of
what is working or not working with your formulated strategy
- Join a Stokvel and make your contributions via stop order/recurring
payment
Refer to my blog for ideas on how you can save and invest your savings in the context of the topic under discussion Living below your means
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