July 2021 - Octogen

New year, brand-new budget

It’s 2021 – a fresh start for you and your finances. Reviewing or writing a budget is the best place to start. Use our free budget planner tool. But first, here are some of the benefits of having an up-to-date budget in place.

1. Your most important costs are accounted for first

Having a budget is just another way to get your priorities straight. Make sure that having a roof over your head, water and electricity available to you, and your major financial commitments such as vehicle finance or loan repayments are front of mind when it comes to budgeting.

2. Get real about groceries

You can buy convenience but it costs more. Reduce your daily, weekly or monthly supermarket spend by shopping smartly. Plan meals, compare per kilogram prices and avoid last-minute treats that take their toll on the budget. Or you can plan for spontaneous purchases from takeaways or convenience foods stores – that way you know how much to spend and can enjoy it without worrying about being a reckless extravagance.

3. Budget for emergencies

Here’s how to start an emergency fund, a vital part of every budget. Saving a little bit every month will save the day for you and your family in the highly unlikely but totally possible (almost predictable) event of some devastating unexpected cost occuring.

4. Enjoy your money

You work hard for it. So, don’t hide what you most enjoy spending money on, rather factor whatever it is into your budget. Sports and hobbies can get expensive. The latest tech, data and TV entertainment costs a lot. Adventures and activities with your favourite people don’t always come cheap. They do say too much of a good thing is bad for you – but a regular, affordable amount of what makes life worth living for you every month is sensible. So, ensure you have included it.

5. Plan and then just live

Once you’ve used our free budget planner and you know how much you’ve got to work with, life is infinitely easier and more enjoyable. You know when to say “yes” and when to say “no, thank you”. You worry less about your family’s needs and your financial wellbeing. You can live freely, knowing you’ve got your stuff together!

You can check your financial wellbeing by taking our quick and easy quiz.

Stay up to date while in debt review in 2021

A new year can bring many changes and communicating anything new is so important. Octogen clients don’t have to do the debt review journey alone, but it is a two-way street. It is up to you to stay up to date in debt review. You must keep us in the loop – and remember that debt counsellors are always available to update you.

Here’s a list of three things to always keep in mind. If you have any changes regarding debt review to report in 2021 or simply want an update from your debt counsellor, please:
– Either call 086 011 1453 or 086 111 3967 and ask for Client Services,
– Or email cs@octogen.zendesk.com with your ID number for reference.

1. Keep contact & personal details current

Call or email Octogen if you … move residences; your postal address changes; you get a new phone number; you start using a new email account; your work details are different in 2021; or even if you get married.

2. Check your balance anytime at all

Call or email Octogen anytime to … check the balance on your consolidated debts. You should always have an idea of where you are in the debt review process in terms of payments. This will help you stick to your goal of paying off all your debts and joining the Debt Free Club!

3. Always tell us about your troubles

Call or email Octogen for advice if you … lose your job, get divorced, become widowed or anything happens to you that might affect your ability to stick to your debt review payment plan agreement with the courts.

Stay up to date in debt review and set some financial goals for 2021. Start by taking this easy quiz.

The hard truth about how South Africans spend

You can live your best life in 2021 by focusing on your finances and yours alone. Don’t let how others around you seem to be spending their money affect your decisions, because here’s the truth – statistically, South Africans are not saving enough, they’re spending too much and they’re servicing way too much debt. Here’s the hard truth about how South Africans spend:

We are spending 70% of our income on servicing debt

That is too high and we should all strive for just 30%. Experts estimate that the lack of growth in most people’s income in 2020 added to increased financial strain has contributed to the four-year-trend that shows most consumers’ debt levels steadily rising. As inflation goes up, short-term, high-interest loans become more popular or necessary, so many South Africans find themselves spending the majority of their monthly salary repaying yesterday’s spend.

The more we earn, the more unsustainable our debt is

“Consumers earning R20 000 or more a month had an unsustainable debt-to-income ratio of 138%.” This according to a Debtbuster report from the second quarter of 2020. That means that most people who earn more than enough to live a comfortable life are living a more luxurious lifestyle they actually can’t afford. On average, their monthly debt repayments are actually almost 40% more than they earn. So they end up borrowing even more and never get out of debt.

Less income should mean a less luxurious lifestyle, but it doesn’t

“It is clear that in absence of meaningful increase in real income growth, SA consumers are supplementing their income with more debt on a large scale,” the Debtbusters report says. So we earn less but we spend the same or more because of inflation. The key here is affordability. Don’t get into debt maintaining the dream lifestyle, rather get real and know that very few South Africans have got a raise or bonuses in recent years.

Check your financial wellbeing by taking this easy quiz. And use our confidential, no-obligation budget planner.