Financial Consultants' Advice on Budgeting, Savings, and Insurance

After securing an emergency fund, one should start saving monthly into a savings product, such as a Tax-Free Investment Plan (TFIP). One can start with an amount of R500 per month, with an annual contribution limit of up to R46,000. It is important to set up this payment as an automatic deduction within monthly expenses. For long-term capital growth, tax-free investments must be diversified across different asset classes. Furthermore, interest, dividends, and capital gains remain tax-free if the annual limit is observed. Although investing is not fixed, allowing access to funds when needed, caution is recommended when withdrawing funds, as they cannot be accounted for in the contribution limit.

As income grows, the amount of this automatic deduction should be increased automatically. After reaching the maximum annual contribution, other investment instruments such as unit trusts or endowments can be considered. Nevertheless, maintaining the habit of saving should be a priority, although small rewards along the way are permissible.

Starting the Financial Journey in Youth

Annalise De Meillon-Muller, Senior Legal Counsel at PSG Wealth, notes that many investors with years of experience regret past choices. For a 24-year-old starting their financial journey, the key step is to begin saving and investing as early as possible to avoid future regrets. Impulsive decisions based on autopilot must be avoided, and long-term risk should not be increased for immediate gratification.

Controlling finances step by step helps build confidence in making financial decisions. It is important to understand that success depends not on the initial amount, but on an early start and consistency. Although starting may create temporary pressure on pocket and bank accounts, it will yield positive results in the future. It is also recommended to consult a qualified financial advisor for assistance in managing one's financial future.

Practical Budget Control Methods

Gerhard Mare, a wealth consultant at PSG Wealth, suggests practical ways to analyze a budget and find opportunities for savings if there are issues with overspending. It is assumed that basic budgeting, which includes reducing unnecessary expenses and setting strict limits on leisure, is already practiced. One convenient method for budget management is using a credit card.

Although credit cards are often associated with excessive spending if misused, when used correctly, they can become a useful budgeting tool, especially when expenses change from month to month. Most cards offer an interest-free grace period, usually around 45–55 days. This allows purchases to be made now and the full amount repaid later without accruing interest, provided the full balance is paid by the due date. This approach helps smooth out fluctuations in the cost of living, such as fuel or food expenses, which may fall on different periods of the month.

It is important to view the credit card as a timing tool, not as a loan. Every transaction must be tracked against the actual budget, and one should not spend more than can be repaid from the next salary. Keeping a separate record helps prevent the 'interest-free' period from turning into 'I'll figure it out later.' Using a credit card that is paid off in full every month can provide some financial flexibility amid rising costs.

Insurance for Small Businesses

Ryno de Kock, Head of Distribution at PSG Insure, emphasizes the importance of considering insurance risks when launching a small business. Although entrepreneurs often focus on growth, clients, and operations at the beginning, insurance cannot be postponed. Including adequate insurance coverage from the outset protects the efforts invested in the business and creates a stronger foundation for overcoming unexpected difficulties.

This is particularly relevant in South Africa, where approximately 385,000 new companies were registered last year, yet up to 80% of businesses fail within five years. Insufficient risk protection is a critical area for business owners to understand. Less than one in five small and medium-sized enterprises in South Africa has formal business insurance, exposing them to risks of operational disruptions, cash flow issues, and long-term sustainability.

Key areas to consider include loss or damage to assets, business interruption, liability, cyber and data risks, as well as internal or personnel risks. Commercial property insurance protects against fire, theft, and natural disasters, while business interruption coverage supports income and additional expenses during operational downtime. Liability insurance is also critical, as third-party claims related to injury, property damage, or alleged negligence can have serious financial and reputational consequences. Depending on the type of business, this may include public liability and professional indemnity insurance.

Cyber risks cannot be ignored, as more and more companies use digital platforms. Cyber insurance helps protect against data breaches, ransomware, and fraud. Additionally, regular software updates, multi-factor authentication, and employee training reduce risks. Businesses must also consider personnel risks, including internal fraud through loyalty schemes and professional liability for consultants. A practical first step is consulting a qualified insurance advisor to identify gaps and structure coverage around specific business risks. Insurance should work in conjunction with risk management measures, such as security systems and emergency action plans.