Eurozone finance ministers formally approved the terms of the problematic Cyprus debt rescue on Friday. But it's not just countries struggling with debt. With the never-ending set of petrol price increases as well as the 8% hike in electricity tariffs, most South Africans' savings will take a knock in the coming months. But you don't have to join the indebted trend. Here's how to safeguard your savings by making a simple mindset shift…
Concerned that you won’t be able to afford the basic necessities soon?
You’re not alone.
With rocketing food, petrol, electricity and other prices, more and more analysts are warning South Africans against falling into the debt trap.
Don’t forget to budget for the sharp petrol and electricity price increases…
And “the situation for consumers will only worsen if they do not factor these increases into their budgets,” says Fin24
But you can act now to steer clear of getting yourself into debt.
Make this simple mindshift to avoid racking up more debt
Just remember that the current culture of consumerism encourages additional consumption, turning luxury items into necessities, says Investopedia
So it’s as simple as stopping and thinking whether you really NEED the item – as with basic household goods like food, or even electricity and petrol – or if it’s just a nice to have, like the latest cell phone model, when your current handset will last a few more months.
That’s why “simple decisions, such as not spending more than you earn and learning to delay purchases until you can pay for them in cash, go a long way toward getting your financial house in order,” explains Investopedia
Because in most cases, the biggest challenge you face isn't financial, but the need to curb your desire to spend.
So don’t rush straight into your next purchase – consider WHY you want the item and whether you really do need it right now or if you can put it off a few months.
That way, you can start saving up for it, which means you’ll appreciate it that much more when you do finally hold it in your hands!
You won’t go into more debt by buying something you simply don’t need.