Consumers urged to save over Christmas

South African Savings Institute launched the festive season savings campaign, Spend Wisely, New Year Ahead.

The campaign aims to refocus consumers to spend wisely and educate them on how to avoid unnecessary consumption.

The institute’s chairperson Prem Govender opened the campaign and reminded consumers to prepare for January expenses instead of spending bonuses all in one go. Adrian Skuy of the National Credit regulator, Prof Bernadene de Clercq of Unisa business market research, David Kop of the Financial Planning Institute and Busi Skenjana of the Stokvel Voice all gave their advice on responsible spending.

National Treasurer Basil Maseko opened the discussion by urging consumers to look after their money and savings, which was emphasised by the South African Institute’s mission to awaken the culture of saving in the country.

“South Africans spend more than they earn throughout the year, and this is exacerbated over the festive season when we are flooded with marketing and tempted by material goods we desire rather than need,” said Govender. “People in all income brackets give in to debt just to make merry during the festive season.

“We must remember that while the festive season creates celebration pressure, this is soon followed by household financial obligations in the New Year which people cannot avoid or delay, such as equipping children for school, getting to work, medical expenses as well as food costs.”

According to Govender, the steep rise in the cost of living has left little to save in 2013 and this would continue in 2014.

“The Consumer Financial Vulnerability Index indicates that the pressure on consumers’ cash flow remains high,” added Govender. “Yet the celebrations continue and many pay for annual holiday expenses out of long term savings, annual bonuses or increased credit card debt. Responsible spending over the season, without incurring debt, is a far healthier option for households’ long-term financial well-being.”