Countless individuals continue to question the real benefits behind being a law abiding, tax paying citizen of this country, when a multitude can hardly make ends meet on a monthly basis. This shouldn’t come as a shock to many with everything that’s going on in the economy. The rand is not doing great, our favourite friend on the rise sin tax is not helping much and of course we need sugar tax to stay healthy and fight obesity in the opulent parts of South Africa before it spreads to the poorer parts of the country.  

No matter how you look at it, there’s something for everyone to complain about and not that much to be ecstatic about. Pick yours!  

The increasing interest rates, price of electricity and food costs are enough to bankrupt a newly graduate with no form of savings to tap in. The sad reality is, that’s the majority of this class of person. At the beginning of every year, numerous entry-level jobs are filled with new graduates with little or no backup plan; just a new qualification and a desperate need for employment to kick-start their prosperous futures.  

It is not long after starting their first jobs when they realise, that this way of life, might just be harder than they thought. New income earners also have many “social needs” to satisfy, so that they can be or form part of the young, successful and educated generation of the republic.  This is their future.  

The need for a reliable set of wheels, which is justifiable for many since various occupations require travelling; a convenient and safe place to live; work-appropriate outfits and a social life with like-minded individuals all make up this natural phenomena.  

Unfortunately, all the above must-have “social needs” come with very attractive price-tags and soon after accumulating one or all of these, young people enter into the adult world of debt. Simple and easy, or so it seems. This leads to bad credit ratings among the youth when faced with the simplest of financial difficulties and regular payments cannot be made to cover everything they have on credit and soon they are listed on all the credit bureaus. If no financial education is gained at this point, young people will easily find themselves in the dark world of blacklisted adults – and it’s tough to get out of this hole.       

Once you have more debt than you can afford, you are nearing serious financial trouble. Pay-up whatever you can and close accounts which do not make financial sense and at the same time speak to your creditors and explain what you are doing and enlist their help.  If you can afford to buy a new dress monthly using cash, or even every second month, there is no reason to have a clothing account that lures you into taking more clothing on credit each month.  More than what you need. As you free up your budget, set aside as much as you can to deposit into a tax free savings accounts. This is where you start.  

All the investment returns earned in these accounts are completely tax-free. The National Treasury released draft regulations governing tax free savings account transfers stating that from 1 November 2016, investors will be able to request a transfer of amounts within a tax free savings account without incurring a reduction of their annual and lifetime limits. Investors will also be able to transfer existing savings from one product provider to another during the life of a tax free savings account - maximum R500 000.  

Another option to consider is investing your hard earned money into funds known as unit trusts. Unit trusts offer you exposure to a range of assets like shares, bonds and property which are selected and managed by investment professionals. The fund is divided into equal units, hence “unit” trusts and as an investor you own a number of units in each fund. The price of these units depends on the value of all investments within a fund.  

Saving for your future should start today. By putting away little at a time, each month you can be one of the happy young adults that banks are more than willing to grant a home loan to albeit stringent requirements need to be met and thereby enabling you to achieve more in your life;  when many are faced with difficult financial situations.