Five tips to improve your finances in 2020

With the new year comes the new year’s resolutions. We have all heard the expression, New year, new me. Psychologically, a new year offers us a new start, an opportunity to change the things that we don’t like in our lives. For some, this means exercising more, or improving their diet. Many others any will promise to spend more time with their family. For most of us it also means managing our finances better. 

Personal finance engineer Hendrik Brand shares some tips to help you with this goal.

Avoid debt

Getting into debt is the easiest thing in the world. You log into your bank account and the first thing you see is that you qualify for R150,000 credit. Once you activate that credit limit, spending more than you earn is easy. It simply involves remembering your pin and finding awesome stuff to splurge on. However, when you buy something on credit, you almost always pay more than the price it was listed at. If you get to the point where you are living on credit, you are paying more for just about every item you buy.

At this point, it becomes hard to break the cycle. Your options are to earn more, which is often not just in your hands, or to spend less. The latter is difficult once you have become accustomed to buying anything you liked. So, this year, find a way to wipe out or at least pay down that credit and store card debt. Buying that stunning pair of heels is much more rewarding when you do it cash with money you can afford to blow.

Know where your money is going

The secret to financial health is much simpler than you think: Spend less than you earn. That’s it. There are numerous apps available to help you monitor your spending and good old pen and paper can work just as well. The bottom line is to try make sure that there is money left in your account at the end of the month.

Whatever method you choose to use, start the year by reviewing what you spend your money on. If your banking cost are too high, switch to a cheaper account, or switch banks. If you are spending too much on recurring costs like magazines and gym memberships you don’t use, cancel them. Check that you are being charged competitive rates for things like insurance. All of this will require you to skip a few episodes of The Witcher tonight but, in the long run, it will be absolutely worth it.

Review your investment fees

Paying high fees on your investments is one of the easiest ways for you to lose out on a bucket-load of money without realising it. Because the growth on investments compounds, each percentage point you lose to fees is amplified in the long run. Review your fees and make sure you are not overpaying for your investments. As a rule of thumb, you should not be paying more than 1% on your retirement savings fund. If you are paying more than this to invest, it is time to move. If you don’t know what you’re paying or what impact this will have on your savings, 10X offers a free fee analysis.

Avoid get-rich-quick schemes

2017 saw millions of people buy Bitcoin like crazy thinking they would be able to retire in a year or two. 2019 was the year so many thought a WhatsApp pyramid scheme was going to make them millionaires. We don’t know what the new decade will bring us but there are sure to be many bubbles and scams. The best way to avoid being caught up in them is to make a plan and stick to it. Do not be distracted by promises of riches and predictions of fantastic returns.

File a tax return

You are not obliged to submit a tax return if you earn less than R500,000 a year from a single source, but if you do not submit a tax return, you forgo the opportunity to claim back some of the money you have paid to the taxman. There are numerous deductions you can claim for, including contributions to a retirement annuity and medical insurance, as well as periods of unemployment. It is usually a good idea to submit a tax return.

Some of these tips may seem like a lot of work, but all are potential keys to managing your finances better. So, make 2020 the year you start to control your money instead of letting your money control you.

Wishing you a prosperous 2020.

- Hendrik

About Hendrik Brand

Hendrik Brand is a content creator for Tigers on a Golden Leash. He has a PhD in Engineering and a passion for coffee, whiskey, and personal finance. When he is not writing, he can be found playing fetch with his cat, changing nappies and travelling with his wife. He writes about everything relating to personal finance and his journey towards achieving financial independence.

Check out his blog at or follow him on Twitter at @tigersonaleash.

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