Save by paying attention to the small amounts (Part 1)

July being National Savings Month, I thought I should weigh in with some pointers which though seemingly obvious can serve you by saving you some substantial amounts. Most times people are more conscious about their spending when it is a large amount, but they never pay attention to the small amounts. If you are able to look closely into your finances there are a number of savings which can result. Although you might not agree with some or all of the suggestions, I want to draw your attention to areas you might have never thought of or have simply been overlooking. You can also read this article which was targeted at graduates.

Coffee

Though I am not a coffee person, I enjoy my cuppa tea, I have colleagues who drink a lot of coffee. I once did a rough calculation of the amounts people spend on a daily cup of coffee [here I’m assuming one cup even though two might be a more accurate reflection of reality]. Assuming a medium/tall average price of R25 in a five day working week one would have spent R125. In a month the amount goes to R500. In a year this works out to R6,000.

A few days ago when I was chatting with a colleague she pointed out how she had to put a limit on the number of coffees she buys in a week after realising she had been spending R600 per month. My drive is not to make you drink coffee, it’s just for you to have awareness.

Vehicle Insurance

Most insurers (if not all) require for you to agree to an ‘excess amount’ when you are signing for insuring your vehicle. This is the amount you would need to pay when you make a claim prior to insurance kicking in i.e. if your excess is R2000 and repairs to your vehicle are for R5000- you would need to contribute R2000 and the insurer pays the remaining amount.  

My mentor gave me a tip which saved me a lot of money when I was looking at getting vehicle insurance. Generally the higher the excess the lower the premium and the reverse holds. When engaging with the insurance broker/agent I was told to look out for the following; after receiving the quote and finding out how much your premium will be based on your profile- ask how much the premium would be if you were to sign for the minimum excess (or other amounts above the minimum). When I did this, I discovered (for that particular insurer) I actually pushed for a reduction in the excess by about R1,500 and my premium increased by about R60 from the original quote.

Your vehicle is a depreciating asset so each year (actually each day, week and month) it diminishes in value. The insurance premium you are paying should therefore reduce at a minimum each year in line with the reduction in value. Insurers know this but not all of them will automatically revise (adjust) your premium downwards at your policy anniversary. You need to get in touch with them and ensure they do the revision, by so doing saving money.