What's Happening?

Facebook Twitter Youtube Linkedin

NEED HELP? QUESTIONS@FIA.ORG.ZA

become A FIA member TODAY
member login

Managing your budget is key to surviving tough economic times

ARTICLE BY

  • Danie Esterhuyse

SHARE THIS POST

The New Year brings in new hope and resolutions to achieve. For many professionals, one of the most common resolution is better management of their finances. Financial resolutions often focus on starting – or sticking to – a budget. However, the key to budgeting is being realistic about your money and finding a system that works for you or your family.

According to Stats SA, on average a South African household will generally consist of three to four people with an income of R138,268 per year and an annual expenditure of R103,293 – meaning that there are ways to manage your expenses and not live outside your means.

It goes without saying that 2018 was tough economically, with rising food and petrol prices, the increase in VAT and the repo rate increasing by 25 basis points from 6.5% to 6.75%. People had to dig deeper into their pockets to survive. However, it was also a good opportunity to assess where you spend your money and prioritise items within your budget.

The majority of South Africans spend their money on housing and utilities first – making this their biggest budget expense at 32,55%. This is followed by transport at 16,29%, miscellaneous goods and services at 14,68%, and food, beverages and tobacco at 13,75% – this is according to Stats SA.

Unfortunately, we all have blind spots that we are unable to see, the hidden costs we’ve never thought about. For example, buying that delicious R30 cup of coffee every morning is costing you R600 a month. That’s a good R7 200 per annum that could go towards your car instalment or your bond.

It’s important that you have an accurate reflection of your expenses against your income. Start by listing all the areas of your financial situation you would like to improve or in order of importance and tackle them one at a time.

A popular rule for allocating your income would be the 50/30/20 rule. This puts 50% of your income towards necessities for your fixed expenses such as bond and car instalment, 20% towards financial goals and savings and 30% to variable expenses like dining and entertainment. Increasing the 20% towards your financial goals will increase your financial stability and security.

Be sure to consider the three basic budgeting tips:

  • Write down your expenses on a spreadsheet and have designated spending categories. Note everything down, not just the big-ticket items like your bond and car.
  • Instead of calculating what’s left over and allocating that to savings, include a savings amount as an expense.
  • Review your budget regularly and recalculate – it’s not cast in stone.
  • Don’t forget to cover irregular expenses like birthday presents, annual subscriptions, car services, etc.

A good budget allows you to take control of your finances, it gives you the power to make the necessary changes in order to achieve your dreams.

Always remember, while having an income to sustain you and your family is a vital part of life, money is neither the end-goal nor should it be considered all-important, but it is what money enables us to do and dream about that takes centre stage.

Subscriber Terms and Conditions

  1. APPLICATION OF TERMS
    • These terms and conditions (“Subscriber Terms”) apply to the subscription by any qualifying member of the South African Underwriting Managers Association NPC (“SAUMA”) to the services and benefits offered by FIA Services (Pty) Ltd (“FIA Services”) under the SAUMA affiliation arrangement (“Subscription”).

  2. NATURE OF SUBSCRIPTION
    • A Subscription under this arrangement:
      • does not constitute membership of FIA NPC;
      • does not confer any voting rights or governance participation in FIA NPC; and
      • is governed solely by the contractual relationship between the Subscriber and FIA Services.

  1. ELIGIBILITY
    • To qualify for the Subscription, the applicant must, at the time of application, be a current paid-up member of SAUMA.
    • FIA Services will verify the applicant’s SAUMA membership status with SAUMA prior to activation, and may re-verify such status periodically.
    • If a Subscriber ceases to be a paid-up member of SAUMA, the Subscription will correspondingly be terminated.
    • Applicants are required to authorise FIA Services to confirm their SAUMA membership status with SAUMA as part of the application process.

  1. SERVICES
    • The Subscription entitles the Subscriber to the following benefits:
      • Complimentary access to the FIA CPD Platform;
      • Complimentary access to the FIA Insight Magazine (digital edition);
      • Advertising opportunities on FIA platforms at a discounted rate of 15% (fifteen percent) off the prevailing published rates; and
      • Invitations to attend FIA Technical Webinars annually.
    • FIA Services reserves the right to update, vary or substitute the Services from time to time, provided that the overall value and nature of the benefits remain materially the same.

  1. FEES AND PAYMENT
    • The monthly subscription fee is R260.00 (two hundred and sixty rand) for up to seven registered individuals (Key Individuals and Representatives), and R36.00 (thirty-six rand) per additional registered individual thereafter, excluding VAT.
    • The Subscriber shall provide FIA Services with the required details of each individual to be registered under the Subscription for the purposes of activation and billing.
    • All fees are exclusive of VAT, which shall be charged at the prevailing statutory rate.
    • Subscription fees are reviewed annually in March and may be adjusted with effect from 1 April.
    • Any changes to the Subscription, including but not limited to the number of Representatives and Key Individuals registered under the Subscription, may only be effected once annually during the annual review period in March of each year, with such changes taking effect from 1 April.
    • Subscription fees shall be billed monthly in arrears, unless the Subscriber elects an annual billing cycle at the time of application.
    • The Subscriber shall ensure that all billing information (including contact details, authorised signatories and bank account details) is kept accurate and up to date.
    • Non-payment of subscription fees may result in suspension of access to the Services until such fees are brought up to date.
    • The Subscriber acknowledges and agrees that all subscription fees payable under these Subscriber Terms may be collected by way of debit order, which shall be processed by the holding company, FIA NPC (The Financial Intermediary Association of South Africa), on behalf of FIA Services. Payment to FIA NPC shall be deemed to constitute valid and sufficient discharge of the Subscriber’s payment obligations to FIA Services under these Subscriber Terms.

  1. ONBOARDING
    • Onboarding will be conducted as a Subscription with FIA Services under the SAUMA affiliation arrangement.
    • Onboarding will not confer FIA NPC membership status or any associated rights.
    • Onboarding is conditional on confirmation of the Subscriber’s current SAUMA membership at the time of application

  1. DATA PROTECTION
    • FIA Services will process all personal information in accordance with the Protection of Personal Information Act 4 of 2013 (POPIA) as set out in our POPIA policies.
    • By subscribing, the Subscriber authorises FIA Services to confirm their SAUMA membership status with SAUMA and to process personal information for the purposes of fulfilling the Subscription.

  1. TERMINATION
    • The Subscriber may terminate the Subscription by giving FIA Services one calendar month’s written notice.
    • FIA Services may terminate the Subscription on one calendar month’s written notice, or immediately if the Subscriber breaches these Subscriber Terms and fails to remedy such breach within 14 (fourteen) days of receiving written notice.
    • Termination of the SAUMA–FIA Services affiliation agreement shall not automatically terminate these Subscriber Terms.
    • Termination by the Subscriber shall not relieve the Subscriber of liability for any subscription fees accrued up to the effective date of termination.
    • FIA Services may suspend or terminate the Subscription with immediate effect in the event of non-payment of fees by the Subscriber.

  1. GENERAL
    • These Subscriber Terms are governed by the laws of the Republic of South Africa.
    • Any disputes arising under these Subscriber Terms shall be dealt with in accordance with the dispute resolution provisions contained in the FIA NPC membership terms and conditions, as modified to reflect that the contractual relationship is with FIA Services.
    • Any notices required under these Subscriber Terms may be validly delivered by email to the addresses provided in the Subscriber’s application form, and such notices shall be deemed received on the day of transmission if sent during business hours.
    • The Subscriber may not assign, cede or transfer any of its rights or obligations under these Subscriber Terms without the prior written consent of FIA Services.
    • No variation of these Subscriber Terms shall be of any force or effect unless reduced to writing and signed by both FIA Services and the Subscriber.