June Pay Day Pointer

It is up to you to right the wrongs of the past by empowering yourself and others – most importantly your children - with the financial savvy required to build financial security.

Financial savvy is scarce

Judging by the current state of affairs, few South Africans understand how to manage their finances and create financial security. Here are the frightening realities:

• Around 7000 vehicles and 2000 homes are being repossessed monthly.
• According to the NCR 41.6% of credit active consumers in South Africa have defaulted or are in arrears with their personal debt payments.
• There are 2 million garnishees in South Africa, which means that more than 1 in 6 employed South Africans are in a critical state of financial distress.
• SADAG receives more than 200 calls daily from people contemplating suicide for financial reasons.

Financial stress is regarded as a major stressor, on par with other major stressors, such as the death of a loved one, moving and divorce, in terms of its effect on people’s health, the quality of their lives and relationships, and their productivity.

Get the knowledge
Does getting the knowledge make a difference?

• If you know what credit card and other short-term debt is costing you, you will avoid new debt and pay off your debt as fast as possible, saving yourself hundreds of thousands of rands.
• If you understand the interest rate cycle, you will know that interest rates will rise again and fall again - and avoid getting into a situation in which you cannot repay your debts.
• If you know how to budget and plan for your financial future, you can ensure you never find yourself unable to cover essential living expenses on your salary.
• If you understand the importance of saving – for emergencies, for a six-month reserve fund, for retirement – you would fall within the just 0.06% of South Africans who save diligently and will enjoy a better financial future.
• If you realise that instant gratification costs you money, but deferred gratification makes you money, you can redesign your financial future.

Knowledge, translated into action, is where the real power lies.

Share the power of knowledge
Another sad legacy from our parents and teachers is the fact that we don’t talk to others, especially our children, about finances.

Involve your life partner and your children in your financial affairs. Ask for their suggestions and ideas and set goals together. They are affected by your financial situation as much as you are, and talking about your finances can go a long way to clear up misunderstandings and reduce their stress, and yours.

Don’t be ashamed to share the mistakes you have made – teach your children that everyone makes mistakes, but they are avoidable and can be fixed. The ultimate goal is to empower them with knowledge so they do not make the same mistakes, or at least know what to do if they have made a mistake.

Don’t assume that your children are too young to understand. Recent research among eight to 15-year-olds revealed that a third of 10 and 11-year olds lie awake at night worrying about the current credit crunch.

The power is in your hands
Like the youngsters who rose up on 16 June 1976, it is up to you to take a stand, to create a better future for yourself and for your children. You can do it. But you have to make the commitment to educate yourself and to implement the necessary steps.

Then share this knowledge with those you care about, so they will have a head start in their financial lives.

We have a more in detail version of the Pay Day Pointer; click here if you would like to view this.

“Human beings have the remarkable ability to turn nothing into something - they can turn weeds into gardens and pennies into fortunes.”

Need financial assistance, Schedule an appointment with your relationship manager by clicking here to discuss and plan your financial wellness

Yours in financial health

Kind Regards,

Your Interface Team