The Principles of Protecting Your Money in South Africa

31 JANUARY 2024

The security of our financial assets is very important to uphold when navigation the world and its responsibilities. With the increase in online banking and financial fraud, protecting your money is a must. Insurance and financial education can help you ensure that your financial future is stable.Smiling man sitting on couch, working on a laptop on his lap

How to protect your money

There are a few methods and factors to keep in mind when managing your money, especially from mobile apps. These are often pre-implemented in apps, however, it is important to keep track of advancements in financial fraud schemes, etc.

Use two-factor authentication

When using your banking apps, or withdrawing money from an ATM, two-factor authentication is an extra layer of protection implemented by the system that confirms your identity. An example of two-factor authentication is an OTP or one-time password. Make sure that you have your cell phone on hand when banking online, and notify your bank if you have received an OTP without making a request.

Keep your banking access limited

Be careful not to access your accounts from anywhere that is not secured, for example, an unprotected WIFI network. Doing so can make it easier for hackers to retrieve your banking information. Avoid this by only logging on through a password required WIFI with “https” in the URL which will signify a secured line of encrypted information.

Check your account daily

Keep track of your expenses by checking your banking statements daily. This will also allow you to notice any unusual activity on your accounts as soon as they happen.

Avoid scammers

Financial fraud is a major problem in South Africa, and it is vital to be vigilant and aware of the many forms of scams. Never share your banking details online through emails or social media. Do not divulge any information about yourself when you receive an unsuspecting request to do so, scammers use this to work out your passwords.

Be aware of relationship scams where scammers aim to form an intimate relationship with you through social media and request money from you because of an accident or robbery, etc. After the money is sent, the scammer disappears. Overpayment scams happen when you are overcharged for a purchase through a counterfeit check. Review the authenticity of a check before sending money to a seller.

How to protect your future

It is important to not only protect your money in the present but also protect the ability to fulfill your dreams. Protecting your assets and financial prospects now will ensure that there are backup plans in place if needed.

Having insurance is a sure way to secure your financial future and allows you to purchase protection against events that could possibly happen in the future resulting in financial loss. Injury or severe illness can affect your ability to provide for your family if they depend on you to sustain a standard of living. Income protection supplements your income lost during these situations.

Further, life insurance can alleviate the financial burdens of your passing, taking care of funeral costs or outstanding expenses. It can take the form of a lump sum or as a monthly income. Your car, house, and other belongings form part of your estate and should also be secured against damages or theft, etc. Auto and home insurance ensure that you do not incur massive financial losses when your assets are damaged. Your insurance company does this by contributing to repairs or as a one-off payment.

After retirement, most of us plan to take time off for ourselves. For this, we need to ensure that we are financially secure to sustain our standard of living without earning a stable income. Start planning for your retirement as soon as you are able to, in order to maximise your returns for the future. Think about your retirement goals and how long you will need to reach them. The most important things to take into consideration are; time horizons, future estimated expenses, assessing your risk tolerance, and doing estate planning.

Protect now to avoid loss in the future

We rely on our money and assets to live a life that we are proud of, and to support our families and loved ones. It is important to protect them so that we reduce unwanted possibilities in the future. Be aware of financial fraud opportunities in your day-to-day activities and plan ahead when you can.