This coming year will no doubt be a tough financial year for all South Africans, with economists warning all to tighten their belts. In light of all the challenges that people face, it is essential to take control of one’s finances in 2017 to avoid falling into financial hardship.

Below is a month-to-month financial planning guide, to empower yourself financially for the years to come.

January: Create a personalised monthly budget

The power of a basic monthly budget should never be underestimated. You should use the first month of the year to develop a template by listing each month and recording both expenses and income so that you can easily identify areas of overspending and act on this before it gets out of hand.

For example, according to the Animal Behaviour Consultants of SA, the cost of owning a medium sized dog accumulates to around R12 000 a year, while owning a cat amounts to around R9 000. This cost combined with a monthly DStv subscription will take out almost R32 000 of a household’s budget for the year. It is clear to see why it is important to have a budget otherwise expenses can get out of control without even realising it.

February: Tax and tax benefits

With the end of the tax year looming, you should use this month as an opportunity to maximise the tax benefits provided by products such as retirement annuities and tax free investment accounts in your retirement and education plans.

March: Consolidate debt repayments

Now is a good time to identify any accounts or loans with high interest rates, such as credit cards and short-term personal loans, and try to pay as much money per month as possible toward these debt repayments.

April: Ensure your legacy

We do not like to think about the bad things in life and therefore most of us put off finalising our last will and testament until it is too late. You should ensure that your final wishes are in place to guarantee all assets and sentimental possessions will be in the hands of your loved ones when you pass away. Estate planning will ensure that you have enough liquidity in your estate to avoid a situation where beneficiaries end up having to sell off assets to pay estate duty or capital gains tax.

May: Income protection

Ensure that you have sufficient sickness cover in place to protect yourself against the financial risks associated with sickness or disability, which could result in you losing your ability to earn a monthly income. This cover is even more critical if you have people who are financially dependent on you.

June: Maintain the home

Severe weather conditions can cause devastating water, storm or hail damage to your house. As a result, it is important to conduct basic maintenance checks and repairs to your property in order to mitigate damage. Most standard short-term insurance policies will only cover damage that is unforeseen, so if it is determined that damage is caused by lack of maintenance, the claim could be rejected.

July: Savings month

July is National Savings Month and provides a timely reminder of the importance of setting specific goals for a long term savings plan. The best way to do this is to determine the most viable saving amount, which will still leave money left in the budget every month to pay for expenses and some type of affordable leisure activity, and look at various savings vehicles. The advice of a financial planner cannot be understated when it comes to long term savings and investments.

August: Make sure money is working as hard as you are

If you have an investment portfolio, you must assess it at least once a year to ensure that you are still on track to achieve your objectives. Investors often fall into one of three traps, either waiting too long to start investing, paying too much for their investment products or their funds or following an investment approach that is too conservative.

September: Retirement planning

It is imperative that you begin to set aside a sufficient monthly contribution towards your retirement to allow the investment to grow as much as possible over the years to come. In addition, you must make sure you understand exactly how your pension/provident fund or retirement annuity works – a financial advisor can assist with this.

October: Medical Aid

During this time of the year medical aid schemes send out communications requesting consumers to review their medical aid benefits. As your medical needs may change during the course of the year, a review will allow you to determine whether you need to upgrade or downgrade your medical benefits, or even change over to a different medical scheme provider.

November: #Feestobepaid

This is normally the time of year that young parents start to think and stress about where their children will go to school. The cost of education in South Africa has soared over the past few years and parents, including those planning on becoming parents in the future, need to start saving for their children’s education as soon as possible. The earlier you start the savings process, the less you have to save due to compound investment growth.

December: When you change your career, don’t extend it

Many people decide to change their careers at the end of the year. This change does not only hold the promise of new beginnings, but also the temptation to spend your accumulated retirement funds on Christmas presents or a holiday. This money should only be used for its original intended purpose – retirement.

The good news is that you do not have to undertake this journey alone. A lifestyle financial planner can help you to make the right decision for you throughout your life. A good planner will coach you to do the things you do not necessarily want to do, in order to live the life you want to live.

You should not wait until you are contacted by a planner before you start working on your financial plan, but rather collaborate with a planner who understands your personal needs in order to achieve financial independence.