Money Plan – What’s That?
Here is an infographic from one of SA’s big banks suggesting how a consumer’s monthly spend should look. They call it a ‘money plan‘ many people would call it a quick budget (but that’s not the world’s most favourite word). You will note that these would be ideal figures/percentages that a consumer might use. The Money plan distinguishes between needs and wants, both of the food in your belly essential nature and the insurance and planning side of things.
Part of the Money Plan is a savings section. Reports indicate that South African’s have one of the absolute worst rates of saving in the world. Without going into too much detail, it kind of works out that less than 1% of SA consumers actually save in their personal capacity. The truth is that your kid may be saving more in their piggy bank than you are.
Here is the Suggested Money Plan
Reports from the NCR and other parties indicate that the majority of people use almost 75% or more to service their debts each month (which might relate to paying for food on a Woolies card or petrol on your credit card etc). Some large debt counselling firms indicate that when they are approached by consumers (most of whom do not budget or have a money plan) these consumers owe more than 100% of their salary each month to pay just for their debts never mind their other costs.
Even if you are having money issues and perhaps especially when you are facing debt stress, you should have a good idea of where you are spending your money each month.