1. How Much Money Do I Earn vs. How Much Do I Spend?
One of the simplest ways to understand your finances is by knowing the balance between your income and your expenses.
Key Steps:
Track Your Income: This includes your salary, business income, side hustles, and any other cash inflow.
Monitor Your Expenses: Look at how much you spend each month on essential needs (food, utilities, rent/mortgage, etc.) and discretionary spending (entertainment, shopping, eating out).
Why This Question Matters:
If you earn more than you spend, you can start saving and investing. But if your spending exceeds your income, you'll need to make changes quickly to avoid going into debt.
Solutions for South Africans:
Cut Back on Discretionary Spending: Many South Africans face higher living costs, especially in urban areas. Cutting back on luxuries like dining out or subscriptions to streaming services can free up money for savings.
Set a Budget: Use simple tools like spreadsheets or budgeting apps to track both your income and expenses.
Prioritize Saving: Consider saving at least 10% of your monthly income, even if you have small goals.
2. Do I Have a Safety Net (Emergency Fund)?
An emergency fund is money set aside to cover unexpected emergency expenses. This fund can be a lifesaver if you lose your job, face medical bills, or deal with car repairs.
Key Steps:
Determine How Much You Need: Aim for 3 to 6 months of living expenses, depending on your situation. In South Africa, this might include rent, utilities, food, transport, and other essential costs.
Build Your Fund: Start small if needed, and gradually increase your savings until you reach your target.
Why This Question Matters:
Emergencies can happen at any time. Without a safety net, you might need to rely on credit cards or loans, which could trap you in a cycle of debt.
Solutions for South Africans:
Start Small: If building an emergency fund feels overwhelming, start by saving just R500 to R1,000 per month.
Put Your Fund in a High-Interest Account: Keep your emergency fund in a place where it earns interest, such as a savings account or money market fund.
Consider Alternative Income Streams: In South Africa, many people have side hustles or freelance work. These extra earnings can be used to build your safety net faster.
3. Am I Saving for the Future (Retirement, Education, etc.)?
Retirement might seem far off, but the earlier you start saving for your future, the better. In South Africa, the future is uncertain, and relying solely on government pensions or employer retirement funds might not be enough.
Key Steps:
Identify Your Goals: What are you saving for? It could be retirement, your children's education, a new house, or travel plans.
Open a Retirement Fund: South Africans have several options, including the RA (Retirement Annuity) or employer pension fund.
Invest Wisely: Depending on your goals and risk tolerance, you might consider investing in a variety of assets, such as stocks, bonds, or property.
Why This Question Matters:
Inflation and rising costs in South Africa mean that what you save today may not be enough in the future. By starting to save and invest early, you can take advantage of compound interest, which helps your money grow.
Solutions for South Africans:
Use Tax-Advantaged Accounts: In South Africa, contributions to a Retirement Annuity (RA) or pension fund are tax-deductible. Make the most of these benefits.
Start with What You Can Afford: Even if you can only save a small amount each month, starting early is more important than saving large amounts later.
Consider Diversified Investments: South Africa's economy can be volatile, so diversifying your investments across different asset classes (stocks, bonds, property) can help protect your future savings.
Conclusion: Key Takeaways
Understand Your Income and Expenses: Start by tracking what you earn and what you spend. Create a budget that prioritizes savings.
Build an Emergency Fund: Save at least 3 to 6 months' worth of living expenses to cover unexpected costs.
Plan for the Future: Make sure you are saving and investing for long-term goals, like retirement or education.
By taking these simple steps, you can start to improve your financial health and build a more secure future for yourself and your family.
Questions after the interview:
At the end of an interview there is usually an opportunity where you can ask any questions you might have. This is a great opportunity to show the interviewer that you are interested in the position as well as the company. It is a good idea to prepare a few questions before the interview – this can be done while you are doing research on the company.
Your questions should show the interviewer that you are a good candidate for the position. Try and avoid questions that are based on your personal needs and preferences, for instance:
- How much leave will I get in a year?
- Will I be considered for promotion in my first year?
- When will I get an increase?
- What time can I leave in the afternoon?
These questions are inappropriate at this stage and will probably raise concerns on the side of the interviewer. Should you be the successful candidate then all these questions will be answered in your letter of appointment so don’t waste this opportunity by asking these basic questions.
If the position is an entry level job or very junior then you are welcome to ask questions in line with the position, for instance:
- Why did the previous person leave the position?
- What would the successful person be tasked to do in a typical day?
- How does this position fit into the department and / or company?
- Could you explain the company structure to me?
- Is there any further education assistance or support?
If the position is more senior then you can prepare question around the following themes:
- current issues that will face the successful candidate;
- inter-personal challenges in the department;
- any process, technology or people challenges that needs to be attended to urgently;
- key result areas that need urgent attention in the first few months;
The above information should get you started. Prepare a few questions so that you can show your worth. Good luck with your interview!
