Time flies when you’re doing awesome things! It’s been years since we unveiled the Fincheck Credit Score tool to you and we’ve seen many South Africans use it since then.

We get inspired to do even more when we see how many people are being helped by this simple tool. Knowing your credit health is a very simple piece of information to direct your next financial step. (If you haven’t received your credit score yet, get it for FREE here

With that said, understanding your credit health is only one part of building a better financial future. It starts with making better financial decisions when it comes to your cash flow.

Cash Flow will make or break your financial health – this is why

No available cash = financial opportunities come to a standstill

When you have no available cash flow, these are some of the common problems that most people experience:

• Cannot pay financial responsibilities like car payments, house payments, debit orders or credit card payments
• Cannot maintain household or family expenses like basic food needs
• Cannot go out with friends or do related recreational experiences
• Cannot enjoy financial opportunities that come your way

So, how can you use the above information to create a better financial future for yourself? We’ve compiled some of the simplest steps to improve your cash flow below!

1. Stop spending more than you earn

This step alone will take your personal finances from rubbish status to healthy status! This is the most important step to reverse the debt cycle over one’s life. Use the Fincheck MyFinance Tool to compare the amount of money that has come in versus the money that is going out.

2. Revisit your expenses, cut some out, make others cheaper

Are you spending money in areas where you can start saving it towards a positive cash flow? Think of spending patterns in your life like fashion shopping, coffee shops, takeaways, and recreational experiences. Then, take a look at the amount you spend on things. Are there cheaper alternatives that you can start using? 

This includes items like:

• Cars
• Insurance
• Cheque Cards
• Groceries

3. Allocate money to an emergency fund and savings

A key strategic move towards a healthy cash flow situation is to put money towards an emergency fund before you spend any money at all. Follow that up with a little extra portion per month towards a savings account. This can be the same account, but the idea is to fill it up like a bucket under a leaking roof (or running tap if you’re disciplined enough!).

4. Allocate money to your responsibilities first

Many South Africans spend the money that should have gone towards things like house payments, debt and other living costs on other things. These expenses are often impulsive (like the latest sale) or spontaneous (drinks with friends). This leads to increasing credit card limits to cover the responsibilities that come after this. Or, taking out personal loans to cover the increasing debt. As with an emergency fund, put the money somewhere you cannot spend it until the debit order goes off! And when you’re left with little else to spend on lifestyle expenses? Well, that’s where the following comes into play!

5. Make some extra money

Make more money by leveraging the skills you have towards some extra money. Who knows what will come out of it – maybe your first ever business? Or, work hard towards that next promotion that is within your reach!

6. Set some goals to keep doing the above

A clear vision and goal will help you to work towards a healthy cash flow situation. It will keep you motivated to apply the above steps! Think about the things that bring you personal fulfilment and make them part of why you’re tackling your cash flow.

Another good step to help you save money and keep tabs on your spending is to use an app like FinWise which can help you budget, track your expenses and work towards your goals of saving money.
With apps like FinWise, you can connect your bank accounts directly to the app and easily see all the information you need like your bank balances, spending insights and budgets to help you organize and stay in control of your cash flow.