As financial institutions prepare their savings month messages about the need to put money aside, debt counselling firms say this is an impossible ask for many South Africans. Read the full article on Fin24; we include an extract below.
Consumers experiencing financial hardships are turning to credit to make ends meet if they can get it.
Carla Oberholzer, a debt adviser at DebtSafe, said people were already struggling to save before the pandemic. But now, with many people displaced from their jobs and living expenses rising much faster than income, messages about tucking extra money away sound “beyond ridiculous” to those who are struggling.
“Since July is a reminder of national savings month, saving is, of course, a fundamental financial goal to have. But times have not been kind,” said Oberholzer.
Benay Sager, head of DebtBusters, said many people want to save – but simply can’t. They have taken significant salary cuts to keep their jobs because of the lockdowns, while real incomes were declining even before the pandemic.
He pointed out that real incomes declined by 17% over the past five years, and the latest consumer inflation numbers, which show that people are paying more for basic foods, will exacerbate the situation.
Read the full article on Fin24.