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Lack of Budgeting may be your Biggest Financial Mistake in 2010Personal Financial Management, Budgeting
Article by Andy Gilder - GM of justmoney.co.za
57% do not plan a budget!
The latest results of the Justmoney.co.za poll indicate that some 57% of the site's users don't plan a monthly budget. This, according to the site's General Manager Andy Gilder, could be the biggest financial mistake that South African's make at the beginning of every year.
"Speak to any personal finance expert and they'll tell you that putting together a budget is the cornerstone of managing household and personal expenses - this is why the results of our latest poll are so concerning."
The Justmoney website deals with more than 40,000 users a month aiding them in comparing bank charges, helping South Africans choose the right credit cards or the cheapest insurance option and giving tips and advice on how to save money in the personal finance arena. Their latest poll results are concerning when placed alongside the most recent site statistics.
"We have seen close on a 20% increase in personal loan applications this month - we usually see an upward trend at the start of the year and it would appear this year is in line with those gone by - people using January to borrow money they shouldn't have spent in December - these early signs of the debt spiral should worry many people.
"When people are scrounging around for expensive forms of unsecured credit, it tells me that they are not managing their finances as effectively as they could be. Setting up monthly budgets and sticking to them could be a way for other South Africans to avoid needing to borrow large sums of money."
When asked the question, "Do you plan a monthly budget and stick to it?" respondents of the poll said :
* Yes: 43%
* No: 57%
Gilder adds "South Africans must remember that planning a budget is no good if you don't stick to it. The real test comes in managing your finances and ensuring that you never spend more than you had planned to - especially if you don't have anything saved up for a rainy day."