daniel chigunwe
Our South African youth is not only a group of passionate individuals and groundbreakers at heart, but they can also exemplify financial resilience, embodying the qualities of true stewards of their finances. And in the process help shape a legacy for others to follow.
Financial resilience means being prepared to handle and overcome unexpected financial events, such as dealing with sudden expenses resulting from changes in the economy, interest rate adjustments, or medical emergencies.
In today’s challenging landscape, developing financial resilience is more important than ever, as it enables you to steer through challenging times without resorting to harmful credit and debt practices.
Empower yourself by building financial resilience in four ways
1. Set goals and develop a healthy relationship with money
Your relationship with money is personal and can be influenced by your upbringing and experiences. It’s essential not to let past encounters or beliefs, such as avoiding discussions about money, discourage or define you.
Instead, see them as an opportunity to assess your financial goals, both long and short-term, and adjust your action plan to be sustainable for your unique situation. Remember, there is no one-size-fits-all solution, and your financial journey is ongoing.
2. Increase your financial knowledge
The world of personal finance can be intimidating, especially if you feel you have limited insight. Seek out resources such as podcasts, seminars, and readily available reading material.
However, ensure that the professionals or organisations you follow are registered and reputable.
By continuously expanding your financial knowledge, you empower yourself to make informed decisions to confidently deal with the complex landscape of money and finance.
3. Saving is important — budget accordingly
Your personal spending plan (budget) is essential for monitoring your income and expenses. One crucial budgeting aspect is prioritising saving by “paying yourself first”.
Treat savings as a regular monthly expense (even if it is a small amount) and set aside money for an emergency fund. By making space for savings in your budget, you ensure that you have a financial safety net during challenging times or unexpected circumstances. Intentionally developing this habit can provide you with much-needed financial stability.
4. Avoid excessive debt and aim for a good credit rating
Maintain a healthy credit score (paying your debt on time every time) and practice responsible debt management to help ensure your financial well-being. Take charge of your financial health by checking your credit score annually and making informed decisions when it comes to taking on additional debt.
Take note, AI or quick fixes may not solve severe debt situations. If you require urgent help with your finances, consider a legal and regulatory solution to help you break free from the shackles of severe debt. — moneyweb
Bongani Ndlovu