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Johannesburg - South Africans, often berated for failing to save, tend to opt for non-traditional forms of saving, Old Mutual said on Tuesday.
Non-traditional savings included owning assets such as property "in good areas" and participating in stokvels.
"There's no doubt that a significant portion [of income] goes towards consumer debt, but what we fail to realise is that the large portion goes toward mortgage debts," the executive director of the Old Mutual Investment Group SA, Derrick Msibi, said at a press briefing in Rosebank, Johannesburg.
He said non-traditional savings increased from 13% of total adjusted savings in 1996 to 18% in 2006.
Non-traditional savings were beneficial, as key asset prices have boomed over the last four years.
"... if you own a bit of equity in this area... you would have done very well because the value of assets increase... so the markets have given very good tailwind in terms of growing saving stocks," Msibi said.
He said Old Mutual has found that household balance sheets were not in the red, due to an increase in the value of assets.
According to Old Mutual SA managing director Paul Hanratty, non-traditional savings in South Africa amounted to around R1trillion.
Msibi, however, added: "For a country of our size... saving levels are not what they should be. They need to be topped up."
Demographics was cited as a reason for this.
Young South Africans, a large part of the population, do not save while the middle-aged group, who generally save, is much smaller than in other parts of the world.
The problem with this kind of non-traditional saving was that in the short term the country depended on foreign direct investment which tended to be volatile.
- Sapa