Tholakele Jiyane got her first job in construction in 2019 and it came with the perks – from accommodation to petrol card and electricity.

She never thought of saving money, instead, she would splurge on clothes she never wore, shoes and outings.

Little did she know that at the end of 2020 when the country was at the height of the pandemic, she would be retrenched.

Even after she got a lump sum, she continued living like she was still collecting a pay cheque at the end of the month.

“I didn’t have a job for a long time and when I got one, it was a proper job. My mom used to tell me about saving but I just never did.

“I was just so excited about having money. If I liked shoes, I would buy them. I would not budget for them. If I liked a clothing item, I would buy it and I would not even wear it to work because I wore mostly jeans and boots. Whatever it was that I liked, I would get it.

“The job catered for everything. All of my money was coming to me. I could not relate with anyone talking about rent and petrol,” Jiyane shares.

She said when she got retrenched, she did not think that she would stay unemployed for a long time.

“I was at home and was continuing with my life. I still bought whatever I wanted because I thought I would get a job after a month. But a month went by and then the second and then it was six months. I then realised that the lump sum I got when I was retrenched was running out.

“I was still buying stuff that was unnecessary. I was not getting a job and that made me realise that I was fooling myself and that I could have done better,” Jiyane said.

She said when she got a job again late 2021, she had to learn how to make better financial decisions because she now had to pay rent and put in petrol, among other things.

“Now, I plan for things I want. I work on a budget. I also think about whether I really need that thing I want to buy. I prioritise and look at whether there is something better I can do with my money instead of spending it on luxury things.

“I now buy groceries, instead of buying take-aways. I don’t see my friends all the time because if I want to see them, I must pour petrol.

“People will always tell you to save but they don’t explain why it is necessary to save. We need to understand why we save. I was reading a book that taught me about how to invest, instead of just saving because your money doesn’t grow.

“If I have extra money, I research ways on how to invest it,” Jiyane said.

Jiyane is making strides in terms of turning her financial situation around.

While in 2022 consumer pockets were hit hard with the rising cost of living and experts have warned that now is not the time to splurge.

We have to buckle up

“With all of this economic unrest over the last few years, we’ve seen so many people fall into the debt trap with little idea as to how to get out of it,” said CEO of National Debt Advisors (NDA) Charnel Collins.

“One of the ways to avoid a crippling debt cycle is to put a financial plan in place and stick to your goals. There’s no better time for it than at the start of a new year.”

Collins said saving money doesn’t have to require drastic steps but instead, taking small methods now can make a big difference in your future.

Collins provides top tips on how to achieve SMART financial goals for 2023:

Specific: Be clear on what you want to achieve. It is also beneficial to decipher how this goal will put you in a better financial position.

Measurable: As you start the financial journey, your needs and goals may change along the way. It is important to make them measurable so that you can evaluate your progress and success along the way.

Achievable: One of the biggest obstacles to achieving a goal is setting your expectations too high. The surest way to improve your financial situation is to take achievable steps, even if that means taking smaller steps. Slow progress is still progress.

Realistic: Unrealistic goals will very soon lead to disappointment. During the process, assess the steps you plan on taking to reach your desired financial position.

Time-based: Establishing a time frame to achieve your goals will encourage you to stay the course and hold yourself accountable.

Collins said the key to building a healthy plan is first understanding your financial habits – the good and the bad.

Bad financial habits can have devastating effects which last for many years. These, she says, include:

Living beyond your means: Avoid making impulsive purchases and start learning to set goals.

Diverting from your budget: Stay on top of your finances by reviewing and re-calculating your expenses every 3-6 months, or when something changes in your life that may impact your finances.

Relying on credit cards and accumulating more debt: Splurging on items using credit will only lead to you paying much more than the advertised price.

mashabas@sowetan.co.za