99FM – Your Inspiration Station

Your Financial Update #7

Get a head start in saving your money


When you first start a formal job, nothing beats the feeling of having your salary in your bank account and imagining all the things that you can spend it on. It’s easy to live in the moment, because the future seems so far away. But it’s absolutely vital to start planning from the very beginning.

You may think you want to wait until you are earning more money to start saving, but as you get older, you’ll have to take on more expenses. Work out your short-term (one year), medium-term (three to five years) and long-term (retirement) goals, and then give careful thought to what you need to do now to achieve all of these. It is important to have fun now, but it’s also important to make sure that you can afford your lifestyle.

Then write out a budget that takes all these expenses into account, making sure that you think of all possible expenses, from the insignificant daily takeaway coffee to the whopping car repairs you have to afford twice a year. To support your medium-term goals like buying a car or putting a deposit down on your first residential property, put your money into a Notice deposit account. A notice deposit gives you a good interest rate and you have to give notice when you want to take your money out and that makes it ideal for medium-term investing.

“A money market account can have an even higher rate, but it still allows you to access your money quickly. This is a good option for saving, but you have to be honest with yourself about how disciplined you will be about leaving your savings to mature.”

Last, but certainly not least, you will need to consider various investment products for your retirement planning. If you are younger, you can look at products with higher risk that provide higher return in the long-term, but your capital is not guaranteed.