Overwhelmed by your expenses? Here are some practical tips to slash your spending

Are you tired of living paycheck to paycheck? With the rising cost of living, it’s becoming even more challenging to make ends meet.

But the truth is, saving money isn’t just about cutting back on luxuries; it’s about making smart, informed decisions about how you spend your hard-earned cash. From groceries, electricity, and fuel to household expenses, every rand counts.

And, with a few simple tweaks to your daily habits, you can save hundreds, if not thousands, of rand each year.

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So, if you’re ready to start your cost-cutting quest and take control of your finances, these tips and tricks Tawanda Rumhuma, savings and investments executive under Absa’s Everyday Banking division, will help you save on your household needs and more.

Begin with the basics: Review your expenditure

A thorough assessment of your spending helps identify unnecessary costs. Start by reviewing your bank statement to spot transactions that might be wasteful. You may find subscriptions or impulse buys adding up. Tracking your expenses can help you allocate more effectively, ensuring you stay within your grocery budget. If you’re struggling to manage your overall budget, many banks, including Absa, offer financial guidance to help you make the most of your money.

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Budget: Identify your household needs and plan your expenditure

This is the most important discipline to adopt. This is where you get to create a personal relationship with your money – you are the watchdog of your finances. A detailed budget provides a roadmap for your monthly fixed and variable costs to help keep you on course. In terms of the 50/30/20 rule of budgeting, it is recommended to allocate 10–15% of your budget towards groceries, as this is considered a need.

Needs should not exceed 50% of your after-tax income, depending on your circumstances and living costs. Plan your meals and track your grocery consumption and expenditure for one month to guide you as you embark on creating a sustainable grocery budget. Identify essentials first and set aside an allocation to include luxuries as your finances allow. Adjust your grocery budget if you eat out frequently.

Shop at discount stores and compare prices

Discount stores offer great value for bulk purchases, while many retailers offer promotions and specials throughout the month. Retailer websites, digital advertising and local newspapers are often good sources of information on promotional items. Avoid a costly spending spree by setting aside time to review and compare prices and products at various retailers ahead of your next shopping opportunity.

Join or start grocery stokvels and buy in bulk

Consider grocery stokvels – pool funds with family, friends or other community members to take advantage of the benefits of bulk buying and consider saving the pooled funds in savings vehicles such as grocery stokvel accounts where the funds are secure and earn interest.

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Bulk purchases of non-perishables, toiletries and other items, including frozen foods, can provide you with breathing room in your monthly budget once the costs have been absorbed upfront. Compare prices and products offered by retailers and wholesaler outlets.

Many wholesalers offer better deals for bulk purchases, especially if you negotiate as a group – you can receive special wholesale prices or discounts, stokvels should leverage group buying power to manage rising food prices. Grocery stokvels represent a significant segment of South Africa’s stokvel market.

It pays to leverage the savings and benefits offered by loyalty programmes

These days, loyalty programmes reward customer loyalty and expenditure across various segments and categories, from entertainment, grocery, health and beauty, fuel, travel, clothing, building and hardware and even carwash patronage with discounts, vouchers, points or actual cash back.

Points-based programmes may offer retailer vouchers with limited options. Cashback-based programmes provide you with the option to allocate the funds either to reinvest the funds into your grocery budget or savings vehicle. Some loyalty programmes offer exclusive benefits to loyalty programme members and discounts on healthier food items, benefitting your pocket and, ultimately, your health.

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