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Johannesburg - The recession has sparked off the first step towards a prudent savings culture among South Africans, but consumers should guard against splurging during the festive season.
The country's gross saving rate is 16.5% of gross domestic product (GDP) for the six months to end-June 2009. This is slightly higher than the 15.2% in the same period last year.
"Household debt levels are still very high and our savings rate is still not good," said the deputy chairperson of the South African Savings Institute (Sasi) Sheshi Kaniki on Wednesday, speaking at the launch of the body's festive season savings campaign.
"For us to grow, we definitely need to increase our saving rate and we still have a long way to go."
A good long-term benchmark to aspire to is 30% of GDP, as is the case in many of Asia's growing economies.
An increase in savings will make South Africa less dependent on foreign capital, Kaniki said.
"Spending wisely and debt reduction are even more relevant as some inflationary pressures continue to loom, particularly from expected increases in power prices," Kaniki said.
According to the National Credit Regulator's Mpho Thekiso, the list of impaired credit records swells by an average of 50 000 people every month. "If you're going to borrow, do so for the right reason," she said.
According to the Credit Bureau Monitor, 7.85 million consumers had impaired records in June, 1.06 million higher than at the same time last year.
How to cool it over Christmas
Sasi has offered consumers the following savings tips for the festive season:
- If you haven't budgeted for a festive season trip, stay at home.
- If you haven't saved, don't borrow to spend.
- Avoid buying on impulse - resist those sale signs.
- When you see sale, think save.
- Make Christmas gifts instead of buying them.
- Give your precious time to the needy as opposed to money.
- Invest in money boxes as gifts for children and teach them to save from a young age.
- Saving is a mindset; live economically and do not waste anything of value.
- Use credit cards sparingly and carefully.
- If in debt, pay this off as fast as you can.
- Don't make up excuses about why you don't save.
- Shop around before you buy.
- Fin24.com