The festive season is often the most exciting time of the year. We spend time with our families and friends and enjoy various activities. Unfortunately, the festive season is the often when we spend the most money. Many people find themselves in financial strain come the new year. How can we avoid this and start off the year on a good note?
Personal finance enthusiast, Miranda Dlamini, unpacks this.
What got you interested in personal finance and prompted you to start sharing your knowledge on YouTube?
I was living paycheck to paycheck when I started working full time in 2016 and I knew that could improve. I started looking for information to assist me with my personal finances and found that the majority of the information online, was US-based. I could not relate to it. I then decided to share my journey to help someone who would find themselves in my shoes. I started my YouTube channel in 2019 and have not looked back since.
What are your thoughts on the Januworry phenomenon?
It is a real problem and it stems from poor money management from the festive season. This ends up carrying over and causing January to seem like a 50-day month. People are paid early in December for Christmas shopping and forget that they must stretch that income until January payday.
There is also a dangerous YOLO fever that exists during the festive season. It makes people loosen up and spend more than their income. Januworry only exists because we create the problem ourselves. We do not create boundaries around our spending in December.
How can people plan ahead in order to survive the financial stress at the beginning of the year?
It honestly goes back to setting a realistic budget and having an actionable plan that will help you stick to that budget. You need to plan how you are going to spend the money before – not after you’ve spent it. To avoid festive season overspending, here are simple steps to follow to assist you in planning ahead:
1. Decide how much you’re willing to spend in December.
2. Start saving at least 6 months in advance to help you prepare for that expense.
3. When you receive your income in December immediately save a portion of that amount to assist you with January expenses.
4. Make use of your December savings and stick to your initial budget, the most important thing here is to avoid overspending.
What are some saving and investment tips you can share? How can one start? Do you need to have a lot of money to save?
I refer to saving as “having your own personal insurance”. You’re not going to get rich from it but it will give you peace of mind in case of emergencies or planned expenses. You can get started by setting up a savings account that earns you interest. Commit to an amount each month and automate the savings.
What are some useful apps that help to track your budget or save/invest?
Budgeting: 22seven app
Investing/saving: PocketFin is a personal finance education platform. Use my code miranda2020 to get 15% off monthly subscriptions
Stash by Liberty: automated investing/saving. Use my code MIR7277 when signing up to get R10 in your stash.
Easy Equities – shares, EFTS, unit trusts, retirement annuity
How would you advise people to deal with financial failure and move forward in a positive way?
The first step is to acknowledge the failure and forgive yourself for it. Analyze what happened and identify your mistakes. Ask yourself, what do you need to do, in order to fix it? Be realistic about the plan so it’s attainable. Learn from the mistakes and prepare to do better when faced with a similar challenge. Be gentle with yourself, you won’t know everything. Allow yourself to be teachable.
What else should we know about personal finance?
Personal finance is everyone’s responsibility if you’re not thinking about money, you’re spending it, you’re stressing about it, you’re making it or you’re planning to make it. Personal finance education is not only for rich people and that’s very important to understand. You are responsible for your own financial success and it’s up to you to take ownership and control of your financial journey. Read books, get help in areas where you are struggling, be honest with yourself and commit to the process.