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Cape Town – Having money is a lot like being in a relationship: When things go well, every day seems filled with happiness, but when it goes wrong, life gets miserable, Old Mutual points out.

“Your relationship with your money affects those around you, in a good or a bad way. If your money is a source of stress you probably pass that stress on to your loved ones,” Old Mutual cautioned in a statement.

In the same way, a healthy relationship with your money will contribute to healthy relationships with those you care about. There’s even an illness – Money Sickness Syndrome (MSS) – caused by the financial worries and all the symptoms of anxiety and depression that go with that.

Divorce rates climb in January, for instance, and there’s some evidence that other kinds of relationships are also more likely to have a rocky patch early in the New Year.

Old Mutual offers some tips to save your relationship with your money:

Reality check

– Find out where you are now financially, by writing down what you spend. In the digital age money can seem unreal – just a swipe of your plastic here and there. Writing down what comes in and what goes out is far more tangible;

– Start by writing down your fixed expenses or the things that stay the same every month. Typically, these are rent, bond repayments or insurance premiums;

– Below these, jot down your variable expenses such as food, transport, rates, cellphone and similar costs. Include items such as entertainment and clothing. If you’re paying for these on a credit or shopping card, use the statements to help you work out what you spend;

– Write down your irregular expenses. These are things such as car maintenance, computer repairs, home repairs and so on. Try to come up with an average monthly cost. It’s better to slightly overestimate than get caught short;

– If they exceed what you’re earning you’re already in trouble. And if they’re close it could just be a matter of time before you’re in the red.

Tackle the problem

– Start by prioritising your expenses in order of importance. You need to pay a bond or rent, you need transport and you have to eat. Ask yourself whether an expense is essential or whether you can reduce or eliminate it;

– Look at your debt, aiming to use the money you’ve saved by cutting back to pay off debts. Start with the ones that attract the highest interest such as shopping cards and credit cards;

– You could also speak to your bank. You may be able to consolidate some payments such as your bond and car finance at a better rate of interest and reduce your monthly repayments;

Carve out your new destiny

– Once you’re back in the black you need to look to your financial future. First, establish some sort of an emergency fund to deal with unexpected expenses. This should be about the equivalent of a month’s salary. You’ll be amazed how much peace-of-mind it’ll give you;

– Next, aim to invest some money to reach your financial goals – ideally around 12% of your net income each month. This is over and above what you should be saving for retirement through your company pension scheme or your own retirement investments. This is where good advice is crucial;

– Once your finances are fixed up, budget a little money each month to celebrate;

– Importantly, empower yourself with knowledge.