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The Importance of your Personal Finances

Managing your personal finances can be a daunting task. It is even worse when you have no clue what to do or where to begin. It, therefore, comes as no surprise that many South Africans are struggling to manage their finances.

An average South African consumer does not have enough money to last them the entire month. Those that are lucky to have enough money for the whole month often do not have enough money for unexpected events or might be skipping a payment on one or more of their credit agreements.

Though it might seem tricky, having a financial plan does not always require the services of a professional. It goes without saying that this will largely depend on your current financial position.

If, for instance, you don’t have too many debts and would just like to structure your finances such that you have enough money for the rest of the month, a clearly defined and realistic budget might be a simple solution to your problem.

If you find yourself struggling to pay your debts on a timely manner, working through your budget and making the necessary adjustments might be a solution, however, if you realize that you are unable to draw up a realistic budget and cover all of your debts, it might be time to find a debt counsellor to assist you professionally.

On the other hand, you might be financially stable with more money in your bank account than you actually need. In this case, you might consider investing the surplus cash and it might be necessary to speak to a financial advisor.

On the subject of advice, Warren Buffet said it better when he said: “Never ask your barber if you need a haircut”. This is simply because the answer will always be the same. Therefore, when seeking professional assistance, look for individuals or entities that are qualified, experienced and conduct their business with the utmost integrity. Remember, honesty is a very expensive gift. Never expect it from cheap people.

Personal Finances permeates your profession, social status, age and many other aspects of our daily lives. Be it that you are a doctor, lawyer, engineer or teller, you need a good grip on your personal finances.

Taking control of your personal finances should not be a future plan, but should be something incorporated into your daily life.

The key lies in taking control of your finances sooner rather than later.