If financial independence and security is one of your life’s goals, then saving has to be just as equally imperative. Whether it is for a trip, renovations, a home, or for retirement, saving is at the core of achieving any of these plans.

July is National Savings Month in South Africa, and organisations such as the South African Savings Institute (SASI) have been encouraging South Africans to return to the basic principles of saving such as budgeting and debt alleviation, especially in light of the tough economic climate that all consumers currently face.

Under the hashtag #crazywaystosave, SASI has been particularly encouraging ordinary young South Africans to share the dynamic ways in which they save, and how they manage to put even the smallest amounts of money away. This is an important approach because saving is very much linked to one’s circumstances, especially considering the National Minimum Wage Bill and how low the country’s average monthly wage is for the ordinary South African.

The bill has been in effect since January, with workers in South Africa entitled to earn R20 per hour, which roughly translates to a R3500 monthly minimum wage calculated, according to a 40-hour working week. When one considers this monthly wage amount, it’s clear that encouraging one to save is easier said than done, especially since the majority of South Africans earn within this monthly wage bracket.

This is why any plans to save need three key principles: a goal, a plan and a budget. It’s also equally important to know whether this is a long or short term goal, and how often you can save towards it. Your second port of call is to find out exactly how much you can afford to save without putting your existing financial demands under pressure.

Your third step is to find out what financial instruments or vehicles will earn you the best returns on what you have been saving so far. Whether it is a tax-free savings account or a retirement annuity for your retirement plans, firms such as ASI are well-equipped to provide you with the best options to suit your needs at the various stages of your life.

As you develop the habit of saving, do not ignore whatever debt you may have. The South African Reserve Bank’s Quarterly Bulletin released in March this year stated that household debt, as a percentage of nominal disposable income, was at 72.7% in the fourth quarter of 2018. This means that over 70% of the average household’s income in South Africa went towards servicing debt last year.

Financial independence is one of the most coveted and satisfying rewards for saving. With this comes financial security, and the ability to make decisions not out of necessity but rather by choice. Whether it is through keeping your loose change in a ceramic piggy bank or by opening a savings bank account, you can only reap the benefits of saving by developing the habit of putting money away towards certain goals, regardless of how small your contribution may be.

The sooner you start to save, the closer you get towards achieving financial freedom.