Use your New Year’s Resolution To Set Your Finances Straight

The New Year might seem like a long way off, but now we have entered October it is actually only a few weeks away. Don’t leave making your New Year’s resolution to the last second. If you do, it will have to be made spontaneously, and most resolutions made in this way fail rather quickly.

Far better to think ahead, suss-out that it is achievable and can be maintained, so that you’ll be ready for when the clock strikes twelve, signalling the arrival of 2019. You can then make a resolution that will stick.

South Africa’s millennial generation has high expectations

The South Africa population has in the past had a poor reputation when it comes to saving money. But that is now changing. The so-called “millennials,” those born between the years 1982 to 2000, are, according to a report published by the Old Mutual Insurance Company, more likely to look to become financially independent and strive to fulfil their desires than their parents were.

The research discovered that nearly a quarter (24%) are actively saving through unit trusts as opposed to only 2% of the older generation. The reasons they gave were: (a) they wanted to improve their net worth, and (b) they were trying to attain financial freedom.

More worrying though was that the research confirmed that while 13% of the older generation had borrowed money to pay off debts, the figure with the millennial group was 35% – significantly higher. The conclusion is that the millennial generation is faced with different money problems – problems that are more likely to result in debt.

Preparing for a financial resolution you can keep.

Travel is another of the millennial’s aspirations, and to achieve this goal many are prepared to put savings aside. But to reach their goal of fiscal independence, they must accrue more assets than debts. Knowing how to get into the situation whereby you can afford to save money on a regular basis is so important.

Getting your finances back in line if you are taking liberties with your credit, is not an easy thing to do, but it is achievable. Take time to work out what you need to do and that you are prepared to do it. Work out a 52 week saving challenge and when the next New Year’s Eve come around, make that resolution, and stick to it.

Misusing credit facilities

Because the millennials have greater expectations than their elders concerning their standard of living, they are more prepared to purchase things like expensive household appliances and cars using credit.

The result is that all too often young people constantly up their credit limits and use them to the full, in order to make it appear to friends and family that they can afford higher standards of living.

The reality is, however, often quite different. They may even be foregoing buying some essentials, while they ramp up their credit, straining their incomes for simply appearing to be keeping up with the Jones’s.

What they ought to be doing is pruning back their purchases to create more disposable income that they can then invest. But, the fact of the matter is that they are getting further and further away from financial independence by misusing credit cards and taking out loans.

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