A practical guide to prioritising your money

For many people, a financial plan feels like something reserved for the wealthy. It’s often associated with sitting across from a financial adviser, answering detailed questions about your goals, risks and future dreams. Then, after a thorough needs analysis, the adviser produces a tailored financial plan.

That’s the ideal. But for most South Africans, it’s not the reality.

Financial advisers largely serve the top end of the market. That makes sense: personalised advice is time intensive, highly regulated and expensive to deliver. But it also means millions of ordinary households are left to figure out some of life’s biggest decisions alone.

Consider the numbers. South Africa has roughly 40-million adults and only about 5,000 certified financial planners. Even if every planner worked around the clock, the maths is unforgiving. Most people will never have the opportunity to unpack their financial needs with a trained professional.

That’s a problem, because financial planning matters far more than people realise.

At its core, a financial plan is not a product that is sold, or a spreadsheet. It is simply a prioritised list of financial goals that evolves as your needs and wants change over time.

It helps answer questions like: what should I save for first? How much is enough? Where should I invest? What trade-offs matter most right now?

Without a plan, money tends to drift towards the loudest expense of the moment. With a plan, money starts working with purpose.

The ‘champagne tower theory’

The good news is that while not everyone has access to an adviser, everyone can apply the core principles of financial planning themselves. The most useful framework is what I call the “champagne tower wealth theory”.

Picture one of those cascading champagne towers at a wedding. You pour into the top glass first. Once it is full, the overflow naturally spills into the next layer, then the next, until the entire structure fills. Your finances can work the same way.

Instead of trying to chase 10 goals at once, you organise your money into tiers of priority. You focus on filling the highest-priority layer first. Once it reaches its target, additional savings cascade into the next layer automatically.

This approach reduces decision fatigue, prevents overcomplication and ensures the basics are covered before you stretch for more ambitious goals.

Tier one: emergency savings

The first level of the tower is protection.

Before building wealth, you need resilience. That means setting aside three months of income in an accessible, low-risk account such as a money market fund or access bond.

Why start here? Because life happens, cars break down, jobs are lost, medical bills arrive and without emergency savings, every setback becomes debt. With emergency savings in place, a crisis is just an inconvenience. Setting up an emergency fund is not exciting, but it is often the difference between financial stability and financial stress.

Tier two: long-term wealth creation

Once your foundation is secure, the next layer is long-term growth. This is where retirement savings and wealth-building assets belong: retirement annuities, tax-free savings accounts and diversified index-tracking ETFs. The goal here is not instant gratification, it’s future freedom.

The earlier you start, the more compound growth can do the heavy lifting. Small monthly contributions made consistently over decades often matter more than occasional large investments made late.

Too many people delay this tier because retirement feels distant. But tomorrow is built by what you do today.

Tier three: medium-term goals

The third layer is where life’s milestones live. This could include saving for a deposit on a home, funding a child’s education, paying for a wedding, starting a business or planning a major trip.

These goals matter deeply because they give money meaning. They connect your finances to the life you want to build.

The key is recognising that every goal has a natural limit. You only need so much for a house deposit. You only need a certain amount for school fees next year. Once a goal is funded, your savings can be redirected elsewhere.

Automation is your best friend

A plan is only useful if it leads to action. The best way to take action is to automate as much as possible. Once you’ve set up your wealth plan, set up scheduled transfers on payday. Let money move into each tier before you have the chance to spend it elsewhere.

Automation removes temptation. It reduces the mental effort of making the same decision every month. And it turns good intentions into consistent behaviour. For goals that change over time, you can adjust allocations dynamically. But in general, the less friction involved, the better.

Planning is for everyone

Financial planning should not be seen as a privilege for the wealthy or a milestone you unlock once you “have enough money”. It is most valuable when money is scarce, because priorities matter more when resources are limited.

As Financial Literacy Month comes to an end, take the time to set up your financial plan. You do not need to wait for the perfect salary, the perfect adviser or the perfect moment. Start where you are – simply list your goals, rank them and start building your tower. 

Because the real power of a financial plan is not that it predicts the future. It is that it helps you shape one.

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_{Top image: Rawpixel/Currency collage.}