According to the Sanlam Benchmark Survey 2013, 56 per cent of employed South Africans start to save at the age of 28 – an alarming statistic given that the recommended age to secure a nest-egg and comfortable retirement is 23 years.
“Various factors influence and impact on the ability of an individual to save,” says CEO of FNB Investment Products, Lezanne Human.
“Fear of retirement and the ability to pay for children’s education impact individuals over 30. Our research suggests that of those who start saving before they turn 30, 78 per cent were taught and encouraged to do so by their parents.”
Human explains that parents, therefore, play a critical role in teaching savings behaviour. Parents across the income spectrum save for their children and are responsible in doing so, however, by not directly teaching children to save, they inadvertently do not foster the right savings habits in their children.
Seizing the opportunity to foster financial literacy through age specific savings initiatives from a young age is crucial. To assist parents in this task, FNB has launched a fee-free savings account aimed to be a hands-on savings tool for parents with children five to 12 years of age.
“We encourage a more responsible savings culture among South Africans and it is our hope that parents will take the lead on this,” says Human.
The first step in fostering a savings culture is by talking to children about savings and explaining the various concepts to them in order to make them less vulnerable to over indebtedness as they grow older.
