Building a Practical Savings Plan

09/23/24 • 32 min

In this episode, we guide listeners on breaking free from debt reliance by establishing a solid savings plan. We explore the importance of saving, what goals to aim for, and the necessity of an emergency fund—why it’s crucial and how to create one. Contrary to common belief, a credit card should not be mistaken for an emergency fund!

We share practical tips for building an emergency fund and discuss the advantages of having a financial safety net for unexpected expenses. We also review the different types of accounts suitable for emergency savings and consider whether incorporating your mortgage as part of your financial buffer is a good idea.

Additionally, we provide insights on how to save for school fees and daily school-related expenses, as well as how to support your parents in building a home without accumulating debt.

By planning and saving for these costs in advance, you can avoid the pressure of last-minute financial emergencies.
#podcast #savings #investing

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Additionally, we provide insights on how to save for school fees and daily school-related expenses, as well as how to support your parents in building a home without accumulating debt.

By planning and saving for these costs in advance, you can avoid the pressure of last-minute financial emergencies.
#podcast #savings #investing

Previous Episode

Dr. Lekalakala's Journey to Homeownership: Shocks, Mistakes & Lessons Learned!

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In this video, Dr. Lekalakala takes us through her inspiring journey to becoming a homeowner. From unexpected shocks to costly mistakes, she shares the highs and lows of the process, what she wishes she knew before starting, and the valuable lessons she's learned along the way. Whether you're a first-time homebuyer or just curious about the realities of owning a home, this conversation is packed with practical advice and real-life insights. Don't forget to like, comment, and subscribe for more content on personal finance and empowering money stories!
Watch the episode here: https://youtu.be/EWyT7NhqDA0?si=SS6bklrCMo3WaVB-

Next Episode

Investing for the Future: Strategies for Long-Term Goals and Wealth Growth

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In our last episode, we focused on saving for those shorter-term goals, but today we’re diving into those medium to longer-term ones—like funding your child’s university education in 10 years, leaving a financial legacy, or maybe even starting your own business. So, how do you begin?
We kick off by emphasizing the importance of setting clear and realistic financial goals. We provide a real-world example of how to calculate future education costs, demonstrating how inflation can dramatically increase the amount you need to save over time.
One of the key lessons in this episode is understanding the difference between interest and growth. While interest is a guaranteed return you get from a bank, growth comes from investing in assets that increase in value over time. We talk about how unit trusts and ETFs are great tools for growing your capital.
We also spend a good portion of the episode discussing tax-free savings accounts (TFSAs). Since their introduction in 2015, TFSAs have been an excellent tax-efficient way to save and invest. We highlight how they can be a smart choice for long-term goals like saving for your child’s education or even adding to your retirement pot. It’s important to view them as long-term investment vehicles, not just regular savings accounts.
We also explore the idea of investing offshore, showing how you can access global markets through local funds that invest abroad. For those looking to diversify and build assets outside of South Africa, local companies offering offshore investment products are a good place to start.
Lastly, we caution against using endowment products for education savings. These often come with high fees and tax complexities that aren’t always in the investor's best interest. Instead, we advocate for simple, low-cost options like TFSAs and unit trusts.