We are not a nation of savers. In fact South Africans are saving less and less. I am amazed that this surprises anyone.
In the wake of the budget, there are always finger-wagging economists telling people they should save more. Of course, they should, but if your salary is not covering essentials, what do you do?
Everyone knows what they should try and do: have three months' worth of
salary saved up in case of disaster, job loss (but then I repeat
myself), urgent home or car repairs, illness. The list carries on. Of
course there's wisdom in that. No one disputes that. The question isn't
whether one should do it but how the hell one should do it.
It’s all very well for the experts to blithely say that people should
think with their heads and not their hearts when spending. This assumes
that all purchases people make beyond their means are for luxury goods.
I disagree. We have reached the stage in this country where people are
buying essentials on credit. And people who don't qualify for credit are falling prey to loan sharks.
After bond repayments, rent, school fees, municipal accounts, taxes, petrol, food and clothing, insurance, car repayments/taxi fares and so forth, very few SA households are left with spare cash. In fact, most households are experiencing a dire shortage of cash - and in most cases I suspect it's not because of the interest on the latest convertible.
Every time I go to the supermarket, or the petrol station, I feel as if I have been robbed. I cannot help but wonder how anyone can put the inflation rate at single digits: clearly the economists and I are living in different countries, or things such as accommodation, food prices and petrol are conveniently left out of these calculations. That's what most salaried people spend the bulk of their money on. In fact, I have a horrible suspicion that the real inflation rate is a lot closer to petrol price increases than people like to think.
So the big question in the end boils down to what you see as an essential. No one really needs designer clothing or imported shoes or expensive cosmetics, but food and petrol and electricity aren’t things we can cross off our lists. It comes as no surprise that those are also the items where price rises have been most vicious in the last few years. When consumers start cutting down on luxuries, retailers seem go for the jugular.
What's more, if I were to start saving to buy a new stove, by the time I had the money together it would cost so much more, so it seems a bit pointless.
The real cost of living
Salary increases and the REAL cost of living parted ways about 10 years ago. It was an acrimonious divorce and there is clearly no hope of any sort of reconciliation in the immediate future.
Let me start by saying that I am by no means opposed to the idea of having back-up funds. Hell, we would all love those. The question is just how most people would manage to get them together, without falling apart two weeks before payday?
I am feeling the pinch not for living the life of Riley, but simply because the cost of living has just spiralled out of control. The cost of silly things such as toilet paper, shampoo and soap has almost doubled in the last 24 months. For the sake of your friends and colleagues, though, I wouldn't recommend saving on any of the above things.
I am deeply aware of the fact that I have so much more than millions of my compatriots, to many of whom some of the things in my life would seem an unspeakable luxury.
I am grateful for what I have, but I would very much appreciate it if we could be spared articles on how little South Africans are saving. The mere fact that two-thirds of the population haven't starved should be seen as an achievement. Could we have an article on that topic, rather than reprimanding articles on how no one is saving money written by people who have never known a day's hardship in their lives?
I think the next person who writes about South Africans not saving enough should be made to change places for a month with a state old-age pensioner. Then we'll speak again about how the savings thing worked out for them on R1270 for the month.
(Susan Erasmus, Health24, February 2014)
(Portions of this column appeared in various guises on News24 in 2011 and 2013 - but the issues remain unchanged, alas)