It’s that time of the year again – well, maybe not quite! Whatever your plans are for the Festive season, enjoy the break and relax.
However, once the festivities and general downtime is done, it’s a good time to think about spring cleaning your finances before the new year really gets underway. Here are some reminders of what you should be looking at:
- Calculate your monthly budget for the new year. Include all your projected monthly expenses as well as miscellaneous annual ones. Unbelievable as it may seem, over 50% of South Africans do not have a monthly budget and often do not always know where money spent actually goes each month!
- Look to reduce debt – especially costly credit card or hire purchase accounts. If you are fortunate to receive a bonus this year then use some of it to pay down debt.
- Ensure you have a back stop call account for unforeseen and planned short term expenses. There are no definitive guidelines as to how much but perhaps keeping the equivalent of three to six months salary in a readily accessible account is about right. You should not have to dip into longer term investments to meet short term needs.
- Carefully check that your life assurance, disability cover and dread disease protection adequately meets your needs. Ask your Maximus adviser to help you with this important assessment.
- Re-visit your objectives as far as retirement is concerned. How much will you need to live on and by when?
- Examine your shorter-term investment objectives such as providing for childrens’ education.
- Look again at your estate plan and its adequacy in the event of untimely death. Check your Will and, if necessary, have it re-drafted.
- You should already have done this but check your medical aid cover, as well as the need for hospital GAP cover if you don’t already have it. Please contact Lorraine on 011 656 2910 or admin@maximushealth.co.za to assist you with this.
- Check your short-term cover for your home, its contents, your vehicles. Please contact Debbie Smart on 082 551 8146 or debbie@maximushealth.co.za to assist with this. Incidentally, Debbie has managed to save money for clients on their premiums quite significantly.
Soon February will be upon us and with it the end of the tax year. It will be the last chance to top up your tax-deductible retirement plan contributions. Check that, together with any employer retirement scheme you may be a member of, you are taking full advantage of the 27.5% of taxable income annual deduction (maximum R350 000 pa).