Salary earners saving less

2013-08-27 07:24
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Cape Town - Cash concerns are causing women to save a smaller percentage of their income than men for the first time in two years, according to British research findings.

Research for National Savings and Investments (NS&I) in the UK points to men saving 7% of their income, compared to 6.84% for women, BBC News reports.

Figures indicate that women are experiencing their lowest savings levels in nearly three years.

"It appears women are under most pressure financially with their savings dropping to 6.84% of their income each month, £72 in real terms," John Prout, NS&I retail customer director, is quoted as saying.

"They haven't been quite so low since autumn 2010," he said. The reseach body said general savings levels were "not encouraging".

Twenty-four percent of women do not save anything at all from their monthly earnings, said the report.

Closer to home, South African Reserve Bank figures show that the ratio of household debt to disposable income in this country is 75.8%.

Experts caution that rising debt levels are having a serious effect on South Africans' savings habits, saying there is an urgent need for consumers to change their mindset and attitude towards saving. Many people simply do not know how to save, says the South African Savings Institute (Sasi).

The 80% of disposable income going towards servicing debt is crushing many South Africans' hopes of building a savings culture, with the trend of young people  being sucked into a culture of consumerism and instant gratification causing debt levels to rise rapidly among the youth.

Sasi CEO Elizabeth Lwanga-Nanziri suggested finding a simple, realistic goal to save for.

“Saving becomes much easier once there is something to save towards, whether it is a long-term or short-term goal,” said Lwanga-Nanziri.

A Fin24 user has also suggested tried and tested ways to save that have worked for him. Among other measures, savings hero Wayne Gadow recommends not touching whatever money is left in a savings account the day before pay day.

"Anything, even a couple of rands, should be transferred into your savings. Try and get the amount to be more each month - you won’t believe how quickly this can add up," said Gadow.

 - Fin24

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