SAVING & INVESTING

It is hard to save, isn’t it? South Africans are drowning in debt, with no apparent way out. And the statistics back up the gloomy state of affairs. According to the South African Reserve Bank, the household savings rate, which was around 6% of the GDP per year in the 1970s, dropped to 1.6% in the 1990s and is now shockingly low at just above 0%. Alexander Forbes financial planner, Jaco Prinsloo, says the savings rate is 0% because, for every R1 someone saves, another person goes R1 into debt, cancelling each other out.

Karabo Ramookho, strategic marketing manager at Old Mutual, states that