How to tighten the belt in tough times

SOUTH Africans are experiencing tough times and the road ahead holds even more uncertainties.

But with self-discipline and a spending plan we can tighten our belts and stay afloat.

This was the message of guest speaker Danie Rademeyer of ABSA Wealth Investment Management, addressing the business community at the first Zululand Chamber of Commerce and Industry (ZCCI) meeting on Tuesday at Bay Shore Inn.

‘South Africa is ‘swimming against the tide of a global turnaround,’ Rademeyer said, listing current economic challenges facing the country.

‘Low oil and thus fuel prices has helped the SA economy, but the free-falling Rand is diluting that effect.

‘Commodity export prices are falling owing to increased supply and reduced demand, especially from China, and it is expected for oil to remain low during 2016.

‘Economic damage was also inflicted by rolling Eskom blackouts.

‘Some observers have suggested a full percentage point loss of GDP growth due to power shortages. We have entered the Eskom maintenance period until mid 2016.’

Rademeyer says severe drought affected maize-producing areas, which in turn had a devastating effect on food security and prices, as maize feeds humans and animals.

‘The weak Rand will compound the effect on USD imports to supplement the maize shortage.

‘The election year will also impact decision turnaround times, because no one wants to make waves at this stage. Voters are king again.

‘Some people are addicted to food, some to smoking, some to speed and some to spending more than their income.

‘Addiction is bad for you, but you still do it.

‘You need a spending plan to motivate you to take control of your expenditure – get out of debt and stay out of debt. Achieve goals for yourself and your family, resist impulsive spending and put away a nest egg.’

He suggested listing monthly expenses in order of priority, starting with what you need to live and breath.

‘Don’t try living up to the Jones’s. Get rid of the big car and elect to sleep well rather than live well.

‘Commit to the plan and get your loved ones to buy into it. Times have changed and the whole family should be involved.

‘If you feel stuck or unsure, get proper advice from the experts.

‘Be the master of your lifestyle and resist peer pressure – do not consume more than you need.’