The importance of savings and insurance

“Savings.” “Insurance.” Where to begin? Rather than overthink it and stress yourself out, why not start small? Control the things you can. Ask the right questions. Make time now to invest in your own financial literacy, so that you can provide for your loved ones, even after you pass on. Supplied

Financial wellbeing starts with financial literacy. The more you know, the better equipped you are to plan and manage your finances.

For many people, concepts like “short- vs long-term insurance”, “investment”, “policies”, and “the benefits of belonging to a mutual” may be difficult to understand. Even “savings”, as simple as it sounds, is just out of reach for so many South Africans.

The good news is that understanding the basics can go a long way toward achieving financial wellbeing. That’s why AVBOB proudly brings you Family first, finance matters – a series of simple financial tips to equip and empower you.

From job losses to increased debt and a general pinch on everyone’s pockets – we were all affected in some way by COVID-19. The answer for most people starts with empowering yourself with sound financial advice and a proper plan that sets you on your way to pursue your short- and long-term financial goals.



Perhaps one of the most important topics is “savings”.

Where do you start? What are you working towards? How will you get there?

As difficult as it may be, especially when facing the financial pressures of low salaries or the high cost of debit orders, saving is something we should strive to do!

The secret to saving is to start small. With small steps and a specific financial goal in mind, you’ll quickly gain momentum on the road to better financial health.

Whether it’s for your or your child’s education, to start a small business, or for unexpected expenses, you must ask yourself what you’re saving for. This will keep you motivated and help you reach your goal!

Speak to a financial services provider to find the right savings products for you.

What about insurance?

How can you use the right insurance products to support your savings plan?

Life insurance is one such product that makes all the difference in helping you secure a better financial future for you and your loved ones.

Did you know that you can take out life insurance no matter how young or healthy you are? In fact, the younger and healthier you are, the cheaper your premiums will most likely be.

If you’re young, single and just starting your career, you may rather want disability cover or serious illness cover. If you’re a little older, and you’re concerned about the financial burden your death may place on your loved ones, then you may want to add life cover. It’s good to prioritise based on your life stage.

Did you know that you can nominate any person or organisation as the beneficiary of insurance cover when you die? Being a “beneficiary” just means that they will receive the cash value and/or other benefits of your insurance policy. You can do this by completing a nomination form with your insurance provider.

The policy will pay out to the beneficiary, who you trust will use it to settle existing debts, like home and car loans, or use the money to care of your dependants, for example, by paying their school fees or even paying your funeral costs.

Life happens. There are many things you simply cannot prepare or plan for. Control the things you can. Ask the right questions. Make time now to invest in your own financial literacy, so that you can provide for your loved ones, even after you pass on.


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