Basic Financial Advice To Get You On Track With Your 2022 Goals

In the first three months of every year, there are three notable occurrences that take place. These include: The end of the tax year, Budget Speech and premium increases from most financial institutions.

To help readers navigate the basics of how to adapt financially to these events, iAfrica asked Metropolitan’s Chief Marketing Officer, Tlalane Ntuli, for some basic financial considerations which form part of their #WeStart2022 Stronger campaign. The following interview has been edited for clarity and length.

At the beginning of the year, many people make New Year’s resolutions. What financial resolutions should people be making and how can they keep track of these throughout the year?

The two most important things I do at the beginning of every year are to revisit my budget and to evaluate the progress I’m making towards my financial goals, for example, saving for my children’s university tuition due to it being extremely expensive. These two habits go hand-in-hand. When looking at my budget, I’ll be able to pin-point the unnecessary things I tend to spend my money on. It’s important to make sure I’m living within my means and not racking up debt. I then look at cutting back on some of the luxuries and indulgences I treat myself to so that I can reallocate the extra cash and put it towards another goal I am saving for. So, instead of treating myself to store-bought coffee every day, I buy one every second day. The saving adds up quickly and I will be able to reach my goal a lot sooner. 

What are the key products, long-term and short-term, that an average consumer should have in their portfolio?

As a start, funeral cover is critical. Funerals are frightfully expensive in South Africa and it’s an incredibly important process in most cultures. There are so many unexpected expenses that can be paid for by funeral cover so that you aren’t left with debt after a loss. The other key product is Life Insurance Cover. This type of insurance allows you to take care of your loved ones financially should something happen to you. The pay-out could assist the Life Cover beneficiaries pay for school fees, pay off a home loan and settle other debt.

It has been a tough 2 years for many consumers, how can people adjust to the challenges brought on by the “new normal” and keep up with their financial obligations?

Dealing with change has become an important skill for everyone to develop. A part of this is learning to identify what falls within our area of control and to really focus on those aspects. Sometimes, it’s easier said than done, so it’s important to ask for help when we need it. We often feel like we need to take it upon ourselves to singlehandedly carry the burden, which makes life feel very daunting.

It’s important to ask for assistance from the people around you, this includes a financial adviser. There’s a misconception that only wealth people need financial advisers, however, the truth is we all need a neutral party we can trust to advise us when it comes to our money. Having a financial adviser will allow you to make better financial decisions, which will help you grow and protect your wealth, even during challenging times.

How do you ascertain if you have too much insurance or a duplication? How does one assess if they are over-insured?

The biggest mistake we see people making is having multiple funeral polices so that they are covered for a larger amount. Whilst having sufficient cover is important, using insurance products this way is inefficient and expensive. Funeral cover premiums are typically far more expensive than life insurance premiums, which means that you’re far better off having one funeral product and one life insurance product, instead multiple funeral policies.

The savings can then be used to increase your existing cover, or you can invest it towards your goals.

You can access all this information by speaking to a financial adviser who can help you by taking a look at your current portfolio and advise you on what needs to be altered. It is very important to receive professional advice on your finances.