Bank charges can quickly accumulate if you don’t review your bank statement and monitor international transactions and subscriptions. It’s important to keep track of your entertainment and streaming services subscriptions such as Netflix, Spotify, Apple and YouTube Premium. Be mindful of your local bank’s charges for international transactions, as small amounts can become significant for family or individual subscriptions. 

What are International Purchases?

Bank charges in South Africa have long been a topic of debate and conversation. International purchases refer to purchases made outside the borders of South Africa. These can include online shopping, service subscriptions, as well as importing goods for your business or personal use. It’s important to always keep in mind that when you make these transactions, you need to consider the exchange rate between the Rand and the foreign currency you are purchasing the goods with.

Most International Purchases Carry Additional Fees, Here’s Who’s Covers Those Fees

The survey conducted by MyBroadBand inquired about international purchase costs and changes in payment methods among the banks mentioned. The services most frequently utilised by consumers with international reach include:

• Netflix
• Spotify
• Amazon Prime Video
• YouTube Premium
• Apple Subscriptions
• In-app purchases

This means, as a consumer, using the above services you are potentially being charged international transaction fees when using these subscriptions.  

What Other Fees And Charges Are You Not Aware Of?

As a consumer, you should be  aware that some local banks may charge higher fees when you use your credit card or debit card for international purchases. These extra costs can quickly accumulate and become a significant amount. The following costs are charged on your card when you transact. 

The following fees you need to be aware of the following charges when conducting your monthly audit on your bank statement:

• Withdrawal fee
• Deposit fees
• Debit order fees
• Account fee
• Deposit on ATM

These charges are commonly encountered with local banks. However, there is a notable difference when you engage in international transactions or make payments for overseas shopping, shipping, or subscriptions. Starting from 2022, local banks have announced that they will now pass on the cost of these transactions to the customer

When Last Did You Audit Your Bank Statement?

With the mid-year budget speech the finance minister suggests that households should tighten their wallets due to the expected lack of improvement in the cost of living. Consumers should regularly review their spending to ensure they are not overspending, and find ways to save money wherever possible. 

This will enable consumers to have enough funds for saving, investing, or using for essential expenses such as school fees, groceries, back to school items, or adding the extra rands to their January budget.

Strict Budget Plan Forecast Versus Current Budget

Budgeting involves tracking your monthly income and expenses, and it can be a valuable and straightforward tool for managing your finances, whether it’s an individual or a family budget.

In a previous article, “The 50/30/20 Budget Rule,” we detailed multiple approaches for consumers to practise smart budgeting and increase their savings. It’s crucial to stay conscious of your expenses and explore opportunities to reduce costs where possible, preventing excessive spending solely on fees and bank charges. By implementing these tactics, you can optimise your budget and establish a reserve of additional savings.

50% Is Purely For Your Necessities

Allocating 50% of your salary is primarily for paying your bills, which can vary depending on your current circumstances. Here are some of the necessary expenses that your salary mainly goes towards on a monthly basis.

• Rent
• Water & Electricity
• Groceries
• Transport fees
• School fees
• Cell Phone and Internet plans
• Medical aid and Insurance
• Vehicle Payment

30% Allocated To Your Lifestyle 

This portion of your funds is designated specifically for non-essential expenses, such as entertainment and dining out. However, considering the current state of the cost of living and the strain on wallets, it is crucial to be mindful of the allocation of funds.

• Entertainment Subscriptions 

Netflix, Spotify, Youtube Premium, Disney Plus, Prime, Amazon, Google Play, Britbox

• Clothing
• Gym
• Dining Out 
• Activities

20% Purely On Your Savings

To effectively manage your finances, it is recommended that you allocate 20% of your budget towards savings

• Emergency Funds
• Short term savings
• Retirement savings

Consider cutting back on non-essential expenses, like entertainment subscriptions and eating out, to redirect funds towards essential needs and start building savings. 

If you are facing difficulties with your debt, our team of financial experts can assist you in better understanding your financial situation and provide relief for your struggles. At Vantage Debt Management, we are here to help you on your journey towards financial freedom.