By Tokiso TKay Nthebe
Saving money requires financial discipline, which is not always easy. Whether you are saving for rainy days, Black Friday, a holiday, or school fees, the challenge is real. Add the high cost of living and the myth that you need a lot of money to start saving and investing, and the journey can seem daunting.
As a financial advisor, I believe that managing your personal finances is a form of self-care. Prioritising, building, and growing your savings should be at the heart of this journey. In this blog, I will share practical tips to help you save money and secure your financial future.
Why should you save?
Savings play a crucial role in financial planning by ensuring you have money when you need it most. Whether to fund your wants, handle unexpected expenses, or achieve financial goals, having savings reduces your dependence on debt, providing financial security and peace of mind.
It is also essential to differentiate between saving and investing. Saving involves putting money aside to meet short to medium-term financial goals while preserving purchasing power. Investing, on the other hand, involves placing money in financial markets with the aim of growing it over time. Investing carries some level of risk but offers the potential for higher returns
Types of saving goals
Saving goals can be categorized into short-term, medium-term, and long-term objectives:
- Short-Term Goals
Short-term goals are those you aim to achieve within three, six, or twelve months. Examples include building an emergency fund for unexpected expenses, saving for school fees or setting aside money for the festive season.
- Medium-Term Goals
Medium-term goals span two to five years and typically involve more significant financial commitments. Examples include saving for a car or home deposit, funding university fees or starting a side hustle.
- Long-Term Goals
Long-term goals extend beyond five years and significantly impact your future. Examples include investing for wealth creation or planning for retirement. When considering long-term goals, factors such as inflation, the time value of money, and interest rates become critical to ensuring your savings work effectively for you.
Do you need a lot of money to start saving?
A common misconception is that you need a substantial income to start saving. This is not true. Many people say, “I don’t have enough money to save” or “I am unsure where to save my money.” However, saving is more about discipline, habits, and consistency than the amount you start with. Even LSL100 can be the foundation of a strong savings habit. The key is to start!
Start where you are. Use what you have. Do what you can. – Arthur Ashe
Where can you Save?
When choosing where to save, consider factors such as interest rates, accessibility, and associated costs. Below are some savings options:
Table 1: Available savings options
| Savings Product | Description | Benefits |
| Money Market Funds | Offered by asset management companies, this product is suitable for savers who are looking for high interest rates. | Money Market Funds (unit trusts) are easy and affordable to access, provide higher interest rates and offer some diversification |
| Treasury Bills (T-bills) | A T-Bill is a short-term investment offered by central banks. | T-Bills are risk free investments and come with maturity dates for example 3,6,9 or 12 months. |
| Saving accounts (traditional) | Short-term saving accounts are offered by commercial banks or insurance companies, allowing you to save. | Provides flexibility to choose the saving period for example 6 to 36 months. Allows you to automate the savings via a debit order. |
| Fixed deposits | Fixed deposits allow you to save your money over a specified period for example 6 or 12 months, while earning interest. | Provides flexibility to choose the period which ranges from 6 to 60 months. |
| Notice accounts | An interest-bearing short-term savings account that requires you provide notice before withdrawing the funds | Flexibility to choose the term for example 7, 32 and/or 88 days’ notice and allows you to automate the savings. |
| Mokhatlo Savings | A savings account offered by commercial banks or mobile money network operators designed for mekhatlo. | Offers transparency and security for Mekhatlo. Opening this account eliminates the risk of the money disappearing when it’s time to share. |
Conclusion
I always encourage my clients and friends to prioritise themselves by managing their finances and building savings—just as they prioritise self-care Sundays. Developing the financial discipline to save consistently is challenging, but not impossible. Like any muscle, it gets stronger with practice. The most important step is to start—and keep going!
Tokiso TKay Nthebe is an author, podcast host, financial coach and lead advisor at TKO Financial Wellness & Advisory who is passionate about financial wellness, education and financial planning.
For more visit www.tkofinancialwellness.com or email info@tkofinancialwellness.com
