More education is needed to promote a savings culture in South Africa. With the country’s recent economic challenges, it’s more crucial than ever for consumers to have a strategy to combat financial instability.
The Need for Alternative Savings Solutions
The South African Savings Institute (Sasi) initiated its annual savings campaign in July, focusing on alternative and high-return saving solutions. According to Sasi chairperson Prem Govender, “Savings Month is designed to remind customers to strive towards financial freedom or remain continuously vulnerable.” This means creating a financial buffer—something many South Africans lack.
A National Effort: Encouraging Savings Literacy
Acting CEO of Sasi, Gerald Mwandiambira, emphasized the importance of savings literacy, stating that South Africans often don’t have a savings pool for emergencies. This led to the introduction of the Tax-Free Savings Account in 2015, a move the institute fully supports as it aligns with their mandate to enhance household savings.
Teaching Financial Literacy from a Young Age
According to Sazini Mojapelo, Group Head of Citizenship at Barclays Africa, saving and investing should be ingrained from a young age. This calls for an industry-wide duty among financial services to prioritize and cultivate a culture of saving.
Corporate Responsibility and Education
Lyndwill Clarke from the Financial Services Board advocates that corporations should deliver coordinated financial education initiatives. These efforts should go beyond marketing and focus on bringing real change to entrenched spending habits.
Breaking the Cycle: Overcoming Challenges
During a panel discussion, Owen Nkomo, CEO of Inkunzi Wealth Group, highlighted the struggle of saving under challenging conditions, such as low wages and multiple dependents. Meanwhile, CEO of the Financial Planning Institute of Southern Africa, Godfrey Nti, stressed that financial literacy requires ongoing efforts, including coaching and dedicated guidance.
This focus on building a savings culture in South Africa isn’t just to protect the individual; it’s a national imperative for economic resilience. As stated by The Citizen, understanding and adapting to alternative savings solutions can pave the way for financial stability for all South Africans.
