As we head towards our summer holiday and all the spending that requires, it is worth remembering that our financial wellness affects our emotional wellbeing.
“Financial difficulty can trigger stress and anxiety, which may lead to or worsen mental health issues,” says JJ van Wyk, financial adviser at Momentum Financial Planning.
“These difficulties can then make it harder to manage money, maintain income and seek assistance, potentially creating a cycle that intensifies the financial strain.”
He advises:
- create a budget based on the 50/30/20 guide: 50% for needs (rent, utilities, groceries), 30% for wants and 20% for savings and debt repayment;
- build an emergency fund — begin with enough money for one month, so unexpected expenses do not derail you;
- pay off your debt using the “snowball” model, paying off the smallest debt first for a quick win, or “avalanche”, paying off the highest interest rate debt first;
- set up automatic transfers for savings and debt payments; and
- spend 15-30 minutes every week reviewing your bank accounts, paying bills or checking your savings goal.
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