FINANCIAL PLANNING 2022 | Thando Ndlovu

2022 is here and am kicking it off by organizing and planning my finances for the year. In this video, I share how am planning my finances for the year and am also sharing a free yearly budget template with you so you can plan and organize your finances for the year.

Hi guys and welcome to my youtube channel in today’s video i want to talk about an experiment that i’m doing with my finances in 2022. you guys know that i love budgeting i always have a budget in every month so i know where my money is going how much i’m saving and spending so i wanted to see if i could you know level it up a little bit and create a yearly

Budget so this is not like a new concept by any measure like people do this all the time especially if you’re like really into personal finance you’d have seen some youtube videos on this topic as well but i have never done it i’ve never like had i’ve never had a yearly budget i’ve had like my financial plan in terms of how my investments and things should go in

Like the next two five years but i’ve never really created like a yearly budget to say in this year i think i’m going to make x amount and this is how i’m going to spend it so this is new for me and i really want to see if it will help me with saving more maybe that would be awesome or maybe anticipating expenses and just managing my money a little bit better or

Maybe even just like reducing the admin of having to do like a monthly budget i could just like you know refer to that yearly budget i already created so yeah this is this is new for me and i want to try this out with you so i’ve created a yearly budget template that you can grab in the description box down below you can download it and then you can create your own

Yearly budget right after this video so yeah let me show you how i created mine and how you can create yours as well so the first thing that you’ll see on that excel sheet is income this is where i like to start when it comes to planning for my finances i think it just makes logical sense if we’re going to talk about planning way that money should go i should at

Least know how much money i’m playing with right so the first thing that i have there is nine to five income this is money that i make from my full-time job i work in tech as a scrum master and i get paid on a monthly basis so that income is somewhat stable i don’t want to say 100 stable because i feel like with what i’ve seen with kovid especially like there’s no

Job that’s like completely like stable and safe but it is relatively stable right so i can somewhat plan ahead for the income i’m going to make from that job a few assumptions i made when i planned for that income is i assumed that my income wouldn’t go up next year so i assume that i’ll still be earning the same amount of money that i’m earning right now so no

Yearly increase no bonus no job change no nothing right which are things that could potentially happen so the income that i planned out for 2022 could potentially go up which is what i would want of course but it could also go down right so but that’s just something to to keep in mind but i think you can relatively like plan ahead for 9 to 5 income because it’s

Relatively stable the second type of income i’ve planned there is a side hustle income i think it has become so abundantly clear during the period that we’ve had covered that having multiple streams of income is absolutely necessary for you to have financial stability financial security right because we’ve seen how people can lose their full-time jobs businesses

Can fail right so you need to have some sort of income that will help you at a time when maybe your main source of income isn’t today anymore so this for me is my side hustle and this is something that i’m always trying to build because i know that the more i build it and the more i invest in it the more money i can actually make at the end of the day from it but

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With this income i can’t necessarily predict how much i’m going to make right but what i can do is plan for 2022 with the money that i know that my business will have going into that year so i know that when january 2022 comes around i will probably have this amount of money in my business bank account to play around with and that is what i have used to plan for

The next few months of the beginning of 2022 and i think that just helps me personally because i don’t like predicting how much i’m going to make with that being said i do have goals in terms of how much i would like to make and i always increase the goal based on how much i made the previous year so i try to like set goals like that by the same time i make sure

That i remind myself that i am not necessarily completely in control of how much i’m going to make that year but i have the goal but i don’t try to predict how much i’ll make i hope that makes sense so that is how i planned out my yearly income and for me i only have like those two sources of income currently i do earn money from like dividends and things like

That but i don’t count it here because i’m not necessarily tapping into those things like my dividends i just reinvested so i’m not going to count them here because they’re not going to end to my cash flow so in terms of savings i don’t have a lot of things to say for this year it’s just like the usual stuff like saving for birthday gifts but the one thing that i

Am saving for that is pretty important to me is my professional scrum master ii certification which is the second level of the certification that i currently have which is part of my qualifications for my 9 to five job so getting that certification for me is an investment in myself in my skills and knowledge which will make me more valuable in my nine to five which

Means i will make more money i might introduce more things to save for based on you know i can’t predict what is going to happen in the future things might come up but that is the plan right now i don’t plan on saving a lot and the reason i don’t save a lot of my money and instead invest it is because of how interest works right i know that if i save my money in

A bank account it’s going to just earn like 35 instead of like investing it in the stock market where i know that it can earn like eight ten percent and like the last couple of years is even earned like way more than that right so yeah that’s why i invest my money because compound interest is way way better so the first investment account that is top priority

For me is the tax-free savings account i absolutely love tax-free savings account and i know that it says take it says it’s a savings account but it is not it is an investment account i do not know why they named it that way but essentially how it works is that any money that you invest in the growth within that account is not good text at all so it is completely

Tax free that means you don’t pay things like dividend tax you don’t pay things like capital gains tax and this makes a huge difference in terms of your numbers at the end of the day so i love maxing out my tax resavings account because i know that by the time i am 40 or 50 or even 30 then money will be so much more than i actually put in so i’ve made like videos

On the text free savings account before so if you want to learn more about text resembles accounts and how you can invest even with like a thousand runs or less than that i will link that i will leave a link to my youtube video down in the description and maybe on the little info eye here somewhere but yeah texture settings accounts are amazing and i try to make

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Sure that i max it out every year and maxing it out means that i try to invest 36 000 runs every single year into that account so practically speaking i just make sure that i invest at least 3 000 runs into my 60 savings accounts every year second investment i have there is discretionary investments and this is where the bulk of my money goes and mainly because

There are no limits in terms of how much i can invest like i said with the texas a tax-free savings account i am only allowed to save or invest a certain amount of money every year right 36 000 months every year if i go above that 36 000 runs and i go and deposit 40 000 runs into my tax resavings account and invest that sales will tax me at 40 percent of whatever

Amount was above the limit so it’s not worth it at all so i stick to the limits with all the accounts that i have that is the tax free savings account retirement genuity as well right but with discretionary investments they’re fantastic because there are no limits so that means i can dump the majority of the money that i invest into discretionary investments instead

Of being limited just with the limits that been set with the tax resales account and the retirement annuities and my discretionary investments are mostly in etfs and i don’t even know why i’m saying mostly because it’s literally all etfs guys that is all i invest in i have no individual stocks at all ever since i started investing and realizing that this whole

Undoubting thing is very real and i need to get my money right um i have been investing in a retirement annuity and a retirement unit is essentially like a retirement account where you can invest your money and put it away and be able to access it when you are a 55 so there’s like rules around it in terms of what you can invest in and things like that and when

You can access it right so i’ve had that account for a while now and i have spoken about retirement annuities as well on this youtube channel if you are not sure what your time activities are but now i recently joined this corporate that actually has provident funds as part of like my whole compensation package so now i have a providence fund through my employer

So every month money is taken out of like my salary before i even get it and put into a proven advantage for me and it is very interesting to see how i do not enjoy that because i realize like i i like having more control and like insight into what is happening in that investment but because this is like going through a corporate it becomes all like complicated

But i’m still learning to understand how it all how it all works so now i have a provident fund so every single month my money is going to be going in there like a little bit of my money every single month is going to go into that providence fund for old me one day so one day i’ll make a youtube video all about providing funds once i also like understand them

A little bit better my expenses might look a little bit slim but that’s really because of one major reason and that’s because me and my partner have a joint account where we contribute money every single month and then we pay all our bills from that one account so i have not detailed like rent electricity and all of that stuff into my personal budget because i

Know that like that contribution that i make to our joint account will take care of all of that stuff for me right so that’s why i only have home as an expense there because that includes everything that i need to survive all of my basics but in the budget template that i created for you you will be able to add more stuff there so if you want to detail things like

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How much you’re going to spend on your rent and your groceries and transport and all of that stuff you can add it on the excel sheet that i created so that is the reason and by the way if you guys are curious to know how me and my partner manage our money um living together please let me know and i will create a youtube video all about that because i feel like

I’ve learned so much from having a joint account with someone and having to communicate and manage money together and i would be keen to share my lessons and then the other experience that i have there is family so i send money to my grandparents every single month it’s not like a lot of money at least not to me but i know that it makes a difference for them so i

Send them a little bit of money every single month they know this and they expect it because we obviously communicate in terms of how much i want to send them and how regularly they will get it so that’s one of the things i really advocate for in terms of like managing like family tax or black tax or whatever you want to call it is communicating and having like a

Regular amount that you know that you can afford that you send right and having them also know that this is what they can expect so that is what that line item is there because i know that i’m going to send this every single month so i need to make sure that it’s in my budget i don’t need to be thinking of oh i need to send this money where does it come from you

Know if you did if i didn’t plan for it i won’t have it so that’s why i have that family line there the other line item and this is the greatest item this is the item i love is entertainment i budget for entertainment every month i make sure i have a set amount that i know i can just blow really and not necessarily have to spend responsibly and for me the my

Entertainment money usually goes to like booking like a bmps um it goes to food those are like the two things that i spend most of my entertainment money is food and beautiful airbnbs and by the way i’m actually in an airbnb currently yeah this is my entertainment guys but yeah that is what the light item is for so i have a certain amount of money every single

Month that i can spend on whatever i want my fun money um i completely advocate for having fun money i think it makes managing your prices so much better especially when because you know like you have some money that you can just enjoy any money where i get like this any little change now enjoyment um but yeah guys that is my yearly budget like i said i didn’t

Use the date column because i don’t have any date um at all so yeah i did not choose that one but it is there on the template so if you are paying off date you can also plan out how much you want to pay towards each date every single month and i think that will really help you in like your debt payoff process as well in terms of becoming debt free but i hope that

This helps you also plan your finances for the year um for the month or even just start thinking about how you manage your finances because i think budgeting is such a powerful tool in helping you achieve your financial goals and building wealth but yeah that is all that i had for today’s video guys please let me know if you found this video useful i will leave

A link down below to the budget template like i said and until i see you on my next video guys let’s chat in the comments and over on twitter and instagram thank you so much guys and i will see you in my next video next week bye

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FINANCIAL PLANNING 2022 | Thando Ndlovu By THANDO NDLOVU