The number of people who are currently saving is declining, research shows. Last year MasterCard conducted a survey to discern consumer purchasing priorities and the research revealed that saving is a forgone priority in an increasing amount of household budgets.

The biggest barrier-to-entry in any budget for savings is the belief that there is no ‘extra’ money to save, and as a result, the money is channelled into commodities, accommodation, groceries and other expense pockets. In most cases, however, this perception is not accurate and is based on emotions rather than true budgetary figures.

A large part of what I do involves helping my clients to create a workable, accurate and sustainable budget. This financial plan (also called a spending plan or a savings plan) almost always highlights areas that money is going to that are either no longer needed (old subscriptions or fees), or being over-paid or are for services or products that may be a lower priority than saving for the future.

Many savings plans fall flat for two reasons: first, they are not specific enough and second, they are not prioritized.


Every day we hear about people who go to gym to ‘train’. But train for what? A healthier body, a nicer torso? Training normally means that there is a finish-line or a competition that is the ultimate goal.People who simply ‘train’ for the sake of going to gym are the ones who fall away from the routine and find that their workouts become further and further apart! But those who train for a specific event keep training and keep increasing their intensity – because they know why they’re doing it.

The same is true for your savings. If you set a specific, attainable goal, you’ll be able to reach it. Take the time to write down specific goals that you would like to save for. These could include the following: retirement, an overseas holiday, a deposit on a house, children’s education, a new car, an emergency fund or even a luxury getaway.

When you know what you’re saving for,
you’re more likely to keep it up!


Times will get tough and you may be forced to lean down on your savings portfolio. Or you might get an unexpected bonus and don’t know what to do with it – all you know is that you want to put it somewhere safe.

Prioritising your savings helps you build some non-negotiables for yourself and build some personal accountability. Liberty proposes these four priorities in your savings plan, but don’t feel like you have to stick to them. If you’d like to talk through your options, remember, that’s what I’m here for!

Priority #1: Emergency Fund (three months of household expenses)

Emergencies are one of the main reasons people get into debt. Life happens and when it does you need to have a plan.Every household should have some money put away for emergencies. Author Dave Ramsey recommends starting with a realistic goal of at least R10 000 put away for emergencies. If you have to dip into it for an emergency then prioritise to replenish it. Aim to build up an emergency fund of three months of household expenses.

Priority #2: Debt

Pay off short-term debt. Paying off debt is a form of savings as you save money by paying off your debt faster. It is always good to have a separate savings account whilst you are paying off your debt, like your Emergency Fund. Don’t prioritise paying off debt over creating an emergency fund. You will find that the psychological benefit of building up your Emergency Fund will spur you on to keep saving! Focusing purely on your debt can keep you in it…

Priority #3: Retirement

Use your tax benefit to plan for retirement. Don’t waste the retirement tax benefit provided by government. If your employer doesn’t have a retirement fund then take out a retirement annuity and save up to 15% of your income – tax free! (this figure is correct at the time of publishing)

Priority #4: Life goals

Your medium-term savings goals are all determined by where you are in your life. If you have just started working and plan on buying a house, then your priority would be to save for a deposit on your home. If you have children your priority may be saving for their education.

So if you want to develop a habit of healthy saving, be specific in your goals and prioritise where you will focus your saving! Everyone is unique so this not a mould for all, but rather a guideline for good financial habits. There is always value in us having a conversation over coffee to give you peace of mind!
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