July is marked as South Africa’s national savings month by the South African Savings Institute. The initiative serves as an awareness campaign because South Africans have a very low savings ratio.
South Africa’s savings are disturbingly low, nearing crisis levels. The household saving rate in SA decreased to -0.2% in the first quarter of 2018 from 0.2% in the fourth quarter of 2017, according to Trading Economics. Personal savings, it says, averaged 4.8% from 1960 until 2018, reaching a record high of 23.8% in the second quarter of 1972 and a low of -2.7% in the fourth quarter of 2013.
While it is not clear if the historical data stemming from the Apartheid era are accurate in terms of measuring all South Africans, the situation is clearly urgent.
Prem Govender, chairperson of South African Savings Institute (SASI), says the overarching aim of July Savings Month is to get people “to examine their sending habits and how best to arrange their financial affairs so that they can start and maintain some kind of savings programme”
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