Hi Tribe,
If you’re anything like me and love journaling or writing down your dreams and goals, you probably have a stack of past notepads or diaries filled with big ideas and bold ambitions.
But here’s the real question: Have you ever taken the time to reflect on those pages and see how far you’ve come?
I recently did just that, flipping through the goals I’ve jotted down over the years. And while I expected to feel inspired, I was hit with a wave of frustration instead. Sure, I’ve achieved some incredible milestones—things I should be proud of—but one glaring pattern stood out.
I found a notepad from January 2023, and to my dismay, the goals written down were almost identical to those I’ve set for January 2025. The same aspirations, two years later! The problem wasn’t the goals—it was me. My habits, or lack thereof, were holding me back.
How many times have we all proclaimed, “New Year, New Me,” only to bring the same habits into the new year, expecting different results? If nothing changes in our approach, our goals remain just words on paper.
This year, let’s commit to real, actionable change. Here are practical steps to transform your personal finances in 2025:
1. Start with Budgeting—and Be Kind to Yourself
Budgeting is foundational for financial health, but it’s not always easy. If you’re starting out or revisiting your budget, remember:
Track Your Spending: For one month, write down every expense – yes, write down EVERYTHING. This gives you a clear picture of where your money is going.
Use the 50/30/20 Rule: Allocate 50% to needs, 30% to wants, and 20% to savings or debt repayment.
Use the Zero-Based budgeting rule: This is a personal favourite of mine! Zero-based budgeting ensures that every rand you earn has a purpose. Here’s how it works:
o Start with Your Income: Write down your total monthly income.
o List All Expenses: Include fixed costs (like rent) and variable costs (like groceries).
o Assign Every Rand: Subtract expenses from your income until you reach zero. Every rand should either be spent, saved, or invested.
o Adjust Monthly: Your expenses may vary, so revisit and tweak your budget each month.
I find that this method forces you to be intentional with your money, ensuring you’re not overspending or leaving funds unallocated.
Don’t Give Up If It Doesn’t Balance: Budgets are flexible tools. If you overspend one month, adjust and try again the next. Progress, not perfection, Okay!
2. Be Conscious of Your Money Stories
Our upbringing and past experiences shape how we view and handle money. Reflect on these questions:
What lessons about money did you learn growing up?
Are there any beliefs holding you back, like “I’ll never get out of debt” or “Investing is too risky”?
Challenge these narratives and replace them with empowering ones, such as “I’m capable of managing my finances” and “Investing is my path to wealth.”
3. Pay Off Debt Strategically
Debt can feel overwhelming, but a clear plan makes it manageable. Consider:
The Snowball Method: Start with your smallest debt. Pay it off, then use that momentum to tackle the next smallest.
The Avalanche Method/Highest Interest First: Focus on debts with the highest interest rates first to save money over time. Remember the higher the interest rate you are being charged on your debt, the more expensive that debt is.
Automate Payments: Set up a debit order to avoid late fees and stay consistent.
4. Build an Emergency Fund—Step by Step
An emergency fund is your financial safety net. Aim for at least three to six months of expenses, meaning that for example, if your monthly expenses are R15,000, your 3-month emergency savings should be R45,000.
Here’s how to start:
Set a Small Goal: Start with R5,000 or R10,000. Small wins build confidence.
Automate Savings: Set up a dedicated account and arrange automatic transfer or a debit order each month.
Cut Back Temporarily: Look for areas to save, like eating out less or pausing subscriptions. Or use bonuses or side-hustles to fund your emergency fund quicker.
5. Invest in a Tax-Free Savings Account (TFSA)
A TFSA is a fantastic and one of the simplest ways to grow wealth over time. You don’t pay tax on the returns, and the earlier you start, the better. Key tips:
Contribute Regularly: Even R500 a month adds up over time.
Choose the Right Investments: Depending on your goals, consider ETFs or unit trusts.
Understand the Limits: You can contribute up to R36,000 per year, capped at R500,000 in your lifetime.
6. Take Care of Your Retirement
Retirement planning may feel distant, but it’s crucial, and boy oh boy, how time flies! One minute you are 25 and the next, you are turning 40 in 4 years (yep, that’s me!)
Review Your Contributions: Are you saving enough to retire comfortably? A good rule of thumb is 15% of your income.
Check Fees: High fees can erode your savings. Compare options and switch if needed.
Consider a Retirement Annuity (RA): (especially if you are self-employed or your employer does not offer a pension/provident fund) It offers tax benefits and ensures you’re setting aside money for your future.
7. Protect Yourself and Your Family
Insurance and estate planning are essential. Make sure you have:
Life Cover: To provide for your loved ones in case of your passing.
Income Protection: Ensures you’re covered if you can’t work due to illness or injury.
A Will: Avoid leaving your family in chaos. Clearly outline how your assets should be distributed.
8. Build Habits, Not Just Goals
The secret to achieving financial success is consistency. Break your goals into small, actionable habits. For example:
Set aside 30 minutes every week to review your finances.
Automate/set up debit orders as much as possible, from your monthly expenses, savings to investments.
Celebrate milestones, no matter how small.
Let’s Make 2025 Different
This year, let’s commit to writing down our goals (as a good friend of mine, Nthona wrote recently on a post/reflection: I am a firm believer that written plans and visions are supplications to God) and actively working towards them.
…What about you? Have you noticed any habits that might be holding you back? Share your thoughts with me on socials or reply to this article.
Wishing you and your loved ones a very happy and prosperous 2025!
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