Spring Clean Your Finances

As spring is firmly upon us and as we head into summer, cleaning out the clutter from your home is a necessary evil. And just like your home, your finances and insurance need to be put in order too.

“Once you’ve made an effort to manage your finances and risks properly, you can enjoy the peace-of-mind achieved through this,” says Robyn Farrell, managing director of 1st for Women Insurance.

It’s easier than you think

Many women feel completely daunted by the prospect of assessing finances with an unimpassioned eye. However, this need not be so.

“Getting to know your financial position is a lot simpler than one thinks, and the benefits are immeasurable,” Farrell emphasises.

• Check your insurance policies: Ensure that your car, home, life and health insurance policies are adequate for the stage you are in your life, and that your cover meets your needs. Make sure that you keep records of all of your insurance policies in a safe place.
• Hire a financial advisor: A good financial advisor is an expert in investments and gives you time to make decisions, answers questions and explains fees comprehensively and clearly. He/she must be meticulous about documentation, and must review all your investments with you to identify those which are underperforming.
• Review your retirement investment/s with your financial adviser in order to plan adequately for your retirement.
• Reduce debt: Prioritise high-interest debt and pay it off first. As you manage to pay off debt, apply that money to the next highest-interest debt, until you manage to retire all your debt.
• Update your budget: Ensure that your budget matches your financial situation. Review your expenditure vs your income, and see if you can increase your savings by cutting down on spending.
• Create a will: If you pass-away without a will, your estate may have to spend more to settle your affairs, decreasing your specified inheritances. If you already have a will, review it whenever your financial or family situation changes.
• Shred old documents: Identity theft is prevalent in South Africa; therefore, it is prudent to shred documents with personal information before throwing them out.

“The effort your apply now might just result in next spring being less about spring cleaning and more about having time to smell the flowers,” Farrell concludes.