5 Financial fitness tips to managing our finances

By Tokiso TKay Nthebe

It is no secret that 2023 has been a challenging year, with many interest rate hikes, the increasing cost of living and many other economical challenges that squeezed our wallets; but somehow we survived. As we draw closer to the end of the year, it is important to reflect on our finances and prepare for the year ahead. This includes, but not limited to letting go of bad, unhealthy habits – such as not having a healthy relationship with our money. To win at the money game, having financial knowledge, good money habits and a comprehensive financial plan are prerequisites. A financial plan is a GPS, that helps us navigate our way towards financial wellness. 

I must also emphasise that having a financial plan alone is not enough. Our financial behaviour and habits influences whether we achieve financial success or not. As we navigate our journey towards financial fitness and success, this blog post shares five tips will get us started,

  1. Financial mindset 

References is made to Sudarshan Sukhani – 3Ms of Trading – Mindset, money and method framework which I often cited in many financial wellness programs. To help us maneuverer and navigate, our mindset, how we make money and manage plays a significant part. The mindset plays an important role when it comes to wining at money – we need to visualise winning financially and actually believe it.

Do you believe that getting out of debt is possible?

Do you believe in your financial goals?

Do you believe you deserve financial wellness?

  1. Financial goals 

Setting financial goals requires that we be specific about what it is we want to achieve. Goals that are not clearly defined are unlikely to be achieved. I advocate for setting goals that are SMART – specific, measurable, attainable, realistic and time bound.

Specific: What do you do specifically want to achieve?

Measurable: What is the cost or amount required?

Attainable and realistic: What practical steps/actions are required? Is there a specific plan in place? How are you implementing?

Time-bound: By when? What are the time lines?

An example of a SMART goal is “I want to reduce my debt by 30% by 31 December 2024”. What do you want to achieve by end of 2023?

  1. Review your financial vitals 

One of my favourite questions to ask my clients is “are you financially healthy?” Do you know you financial health status? 

In order to know where we want to go, we need to know where we come from and understand our money habits because they influence our financial decisions. A good starting point would be reviewing our bank statements and deciding what needs to change – how can you increase your earn potential or sources of income? Are there expenses you need to cut going forward? Are there any lifestyle changes that you need to make? From a savings perspective, how much of our income actually goes towards saving for rainy days and pay off debt? 

  1. Financial plan

Using travelling as an analogy, in order to get to your travel destination, mapping out the route, preferred mode of transport, booking accommodation and having an itinerary are important. As such, having the GPS coordinates and confirming accommodation are essential right? The same analogy applies to our finances. In order to achieve financial wellness, we need a comprehensive financial plan that clearly articulates our strategy  – covering elements such as our budget, savings, debt management, risk and investment management, retirement, taxes and estate planning. With the help of a qualified financial planner, you too can draft a financial plan tailored to your specific goals and financial needs. Remember, a financial plan is not only for the elite or wealthy, everyone needs a financial plan. What better way to start the new year than with a financial plan?

  1. Balance 

Finding a balance between living for today, but planning for tomorrow is not easy. It is, however, important! As we navigate life’s uncertainty and opportunities; having a balanced approach to our finances is important. It is essential to plan and spend money on the things that make life exciting and enjoyable. We work very hard for our money and we should be intentional about spending it, but also being responsible enough to plan for tomorrow – savings, investments, paying our taxes and preparing valid wills to protect our estates. Again, with the help of a financial planner we can craft financial plans that incorporate our lifestyles that enables us to enjoy life and achieve our financial goals.

Wishing you health, love and financial prosperity!

First appeared in Insure Digest Newsletter, 2022