WHAT do Mzansi people want to do with their money this year?
According to a recent Capitec Bank survey, 40% of the respondents said they are focusing their efforts on finding a well-paying job and 37% have the primary financial goal of paying off debt.
The survey, which focused on millennials, found that 32% of the respondents have an ambition to save more.
When asked what they were saving for this year, 40% of the respondents wanted to own their own property, 22% wanted to travel the world, 21% wanted to further their education and 17% wanted to buy their first car.
Thuso Mbedu (27) – SA’s own two time Emmy-nominated actress and recent home owner – identifies strongly with young people wanting to get a foot in the property door.
She and her sister saved for many years before they could afford a bond.
“My advice is to start saving. You may think you have no money to spare but by focusing on your budget and cutting out a few luxuries, you can make a start. Compound interest works in your favour, which makes a big difference towards reaching your goals,” said Mbedu.
The state of saving in Mzansi
The online saving calculator, MyTreasury.co.za, ranks SA’s household savings rate last against G20 countries. Two reasons for this are that South Africans fail to save during boom times for bad times. Plus, people may not be saving as wisely as they should be, with the SA Reserve Bank finding that 40% of the money sitting in savings accounts earning very low or no interest at all.
How to save better
Francois Viviers, marketing and communications executive at Capitec Bank, said that the art of saving means picking the right banking services to get the maximum return on your money.
“Placing your money in a bank account does not necessarily mean that it is earning interest. Most cheque accounts don’t offer any interest and not all savings plans are created equal.”
- Transactional accounts with interest
This account links up to four flexible, fixed or tax-free savings plans and earns you from 5,1% to 5,65% interest a year from the first rand in your account.
- A flexible savings plan
This account allows you to choose your deposit amount and how frequently you make deposits. With Capitec, it earns you from 5,1% to 5,65% interest annually on daily balances.
- Fixed-term savings
This one is great for long-term savings goals. You pick how long you want to invest, from six months to five years.
