use credit wisely improve your life and realise your dreams

Transcription

1 use credit wisely improve your life and realise your dreams

2 contents Signs you may have credit issues Spot the 5 signs of bad credit and take control of your money again. 02 What to ask before buying a car Asking the right questions can get you the best deal. 03 Invest in your future Ways to pay, and save for education. 05 High-impact home improvements Add value to your home with these high-impact ideas. 07 Budget planner and guide Plan your budget and work out how much credit you can afford. 09

3 5 signs of bad credit smart ways to recover Credit is a great way of helping you get ahead. For example, consider how a loan used to buy a car can improve your life it gets you to work, gives you freedom, saves you time. But if you don t manage credit correctly and keep it under control, it can have a negative effect on your life. You use too much of your income to pay off debt You can t keep track of how much you owe You borrow money to pay off debt You ignore letters or requests from your creditors You hide your debt from family take control Follow these steps Get a free copy of your credit report from Know what you spend your money on and always ask yourself if it is a need or a want. Use the budget planner and get a clear picture of your credit situation. Speak to your credit providers if you re having difficulty making payments. Prioritise paying off the debt with the highest interest. Only take on debt that you can comfortably repay on time. change your life read the full story bit.ly/creditissues budgeting tool Get started to find out how you should be splitting your monthly budget. bit.ly/capitecbudget Money Management 2

4 what to ask before buying a car Buying a car never loses its thrill. It s even more exciting if it s your first. Consider some important issues before you hand over your money. how will you pay? First work out what you can afford. Look at your budget to see how much you spend on car repayments. Monthly repayments aren t the only costs to worry about. Other costs: Car insurance Fuel Licence fees Maintenance costs If you re not paying cash you ll need to get credit, which is offered by car dealerships and banks. Vehicle finance means that the car is only yours after your last repayment and it s more difficult to get car finance on a vehicle older than 10 years. If you choose a personal loan to pay for the car, it will be yours immediately. Capitec Bank offers credit up to R over 84 months. The money is available immediately and you get free retrenchment and death cover. new vs used Your budget will tell you whether buying new or used makes the most financial sense. New cars are appealing because they ve never been driven by anyone else, and you re guaranteed a clean history. Buying used often means you can buy a better model or an upgrade of the new vehicle you were going to purchase, because the first owner took the biggest depreciation. When buying secondhand, consumers can choose between buying from a dealer or privately. Both have their advantages. Buying from a reputable dealer offers the customer guarantees if something goes wrong, while buying privately can cut costs. Be careful when buying online: always view the car during the day, try to take someone with you when you do and make sure the seller gives you the vehicle s documentation before you hand over the money. 3 Capitec Bank

5 used-car checklist Here are some of the key questions you need to ask: 1. If buying from a dealer, is it reputable and does it belong to the Motor Industries Federation (MIF)? 2. Are there any warrantees and guarantees still available on the car and will this transfer on change of ownership? 3. Is it being sold for a fair price? (Use the Internet to do some research) 4. Is there an authentic service history available that can be verified? 5. Has the car been in any accidents? 6. Does the car have a low mileage? 7. Is the mileage on the odometer correct and can it be verified? 8. Is there a mechanical report on the car? (If not, consider doing one before the transaction is concluded.) 9. Are there signs of oil leaks and rust? 10. Are there dashboard cracks? (This could indicate that the car has been standing in the sun, and might mean that the other rubbers such as window rubbers are also damaged.) ask the right questions read the full story bit.ly/creditissues credit calculator Choose the amount and term to work out how much credit you can afford. bit.ly/credittool Money Management 4

6 invest in your future start today A good education is a great investment but it doesn t come cheap. Here are 5 ways for you to pay for an education. Student loan Some banks offer loans to pay for tertiary studies which usually cover fees, accommodation, books and related equipment. Personal loan Ideal for part-time students and those studying short courses. You choose how to use the money (e.g. fees, living costs). Capitec Bank offers credit plans up to R Scholarship/Bursary Scholarships cover up to 100% of your fees, but be ready to show why you re the best candidate! Some companies and institutions offer bursaries. Candidates often have to work for the bursary provider after studying. Part-time jobs Check campus noticeboards and websites. Universities also offer work opportunities such as being a tutor or admin assistant. Company training Some companies have training budgets for courses or skills that add value. Speak to your HR department to see if you qualify. 5 Capitec Bank

7 student saving tips Stretch your rand with these 8 ideas Start early and put money into one of our 4 personalised Capitec Bank savings accounts, earning from 4.4% 9% interest per year from the first rand Cut your bank costs with zero-fee card purchases by paying with your Global One card instead of with cash. Cash withdrawal fees are also much less at selected tills than at ATMs Set up a budget and plan how you ll use your money. Student life can be expensive, so stick to your plan Before term starts, check out school or campus noticeboards and classified websites for used textbooks and other needed items Buying stationery in bulk and from factory shops is often cheaper than from chain stores. Search for stationery factory shops online Form a support group with other parents. For example, set up a chat group where you can share news of sales and discounts Flash your student card for any discount you can get Make use of free WiFi on campus and at cafés to catch up with friends and family, and for doing research paying for education read the full story bit.ly/edsave savings calculator Identify what you re saving for and how to reach your goals. Our savings calculator will get you started. bit.ly/capitecsave Money Management 6

8 high-impact home improvements Buying a home is the biggest investment most people will make. It needs lots of love, attention and money to make sure that it looks good, remains in a great condition and increases its value over time. Here are some high-impact makeover ideas for you to try. If you ve got: R2 000 R Spend some money on a garden clean up and trim Invest in new scatter cushions for various rooms Paint a feature wall behind a television or bed Keep things tidy with baskets or wooden storage containers Replace worn or dirty carpets, especially in high visibility areas Repaint or reupholster secondhand furniture Bring the light into your home with a skylight Spend money on accessories like pot plants and vases improving your home is easy Capitec Bank offers credit up to R over 84 months. The money is available immediately and you get free retrenchment and debt cover. R Repaint kitchen cupboard doors, replace counter tops and door handles, and put up painted shelves Buy original art at end-of-year student exhibitions, markets or online art shops Replace bathroom basins and taps Invest in a closed combustion fireplace R New skirtings and cornices make a huge impact Replace old downlights and switches with new ones Upgrade your security with electric beams, burglar bars, electric fencing and maybe even cameras R Paint the house, inside and out, including fascia boards, gutters and downpipes Retile bathrooms, add a modern glass shower, and put in natural stone tops A wooden deck or terrace is always a bonus 7 Capitec Bank

9 ideas for every budget read the full story bit.ly/homefixes credit calculator Choose the amount and term to work out how much credit you can afford. bit.ly/credittool Money Management 8

10 planning your budget take control of your money Monthly income Your income Partner s income Part-time work Commission Total income (A) Monthly expenses Fixed expenses Home loan/rent Medical aid Water Electricity Telephone/Cellphone Bank costs Internet/TV Education policy Insurance policy Funeral policy Credit/Store cards Furniture Education/School fees Sport/Gym fees Budget Budget Actual Actual General expenses Budget Actual Groceries Family support Clothing Medicine Hair/Beauty Kids pocket money Entertainment Restaurants/Takeaways Cleaning service Transport Budget Actual Vehicle instalments Fuel Vehicle repairs Taxi/Bus/Train fare Total income (A) LESS Total expenses (B) Surplus (disposable income) This means you should think about saving or investing this extra money. Total savings/ LESS investments (C) R Total expenses (B) R LESS Total income (A) R Shortfall R This means you should cut your expenses immediately and/or find extra work to increase your income. remember Yearly expenses: Make a list and spread the cost over 12 months. These expenses may include your TV licence, car licence and postbox hire Replacement expenses and repair work: Plan for these expenses by setting money aside each month for things that may need to be replaced or repaired some day, like your car or fridge Investments: Aim to save 10% of your salary each month. Consider interest-earning investments they grow each month. Choosing an investment that you can name, like one of our savings plans, can help you stay disciplined R R R Total expenses (B) Monthly savings/investments Budget Actual Total savings/investments (C) 9 Capitec Bank

11 how to budget 1. Think ahead 2. Understand your income 3. Understand your expenses 4. Cut unnecessary expenses 5. Draw up your budget notes monthly income R net income (on salary slip) Your income (after deductions) other income Partner s income Part-time work Commission monthly expenses R6 900 fixed expenses Home loan/rent Medical aid 500 Debt repayment (bank) 300 Debt repayment (retailer) 200 Vehicle repayment 200 other expenses Groceries Transport 800 Family support 500 Water 250 Electricity 250 Bank costs 300 Telephone/Cellphone 200 Clothing 200 surplus R9 100 disposable income Use your disposable income to invest in savings first before spending it on wants, which are luxuries or unnecessary expenses Money Management 10

12 money management credit tips tip 1 tip 2 tip 3 Determine your affordability: can you easily afford the monthly repayments of your loan? Determine what money you have available after all your expenses. Plan your budget and consider your commitment for the full term of a new loan. Always have extra money for unexpected expenses. When choosing a credit provider: compare interest rates, admin fees and credit life insurance. Understand the full offer and ensure that there are no hidden costs credit life insurance is the most common hidden cost Match the loan term to your purchase: if you are paying for one years worth of education ensure you pay off the loan within a 1 year period. Become money smart SMS your name & address to and receive more money management tips. Visit our Money management page to: Crunch the numbers Utilise our on-line calculators to help you manage your money Tips & News capitecbank.co.za/money-management 2858 Credit A5 Booklet