The sermon of saving has been preached for as long as I can remember, with people telling me that saving will ensure a brighter future for myself and my future kids.
Save, save, save! That’s the sermon that’s been preached to me since primary school. My naïve self thought that saving was an easy exercise to do. I mean, all I had to do was put some money aside, find a proper investment plan and just let it accumulate. When I look at it now, it’s almost laughable because you can’t ‘save’ your way out of poverty. I’m not saying putting money aside is a bad idea; in fact, I think it’s a fantastic idea. What I’m saying is that saving is almost unrealistic for a person like me.
Picture this: A 26-year-old who has recently moved out of home and renting an apartment and paying rates, paying back student loans, sending money home, and planning to go back to university for postgraduate studies. I don’t need to tell you how underpaid South Africans are, and this trend seems to cross professions. By the time I have paid off my bills, including clothing accounts that I needed at the time but regret now, I have little money left to survive the month. Alas, the burden of living pay cheque to pay cheque.
I was having a conversation with a friend, and that was when I realised the predicament I’m in. She told me that for our children to have decent trust funds by the time they’re 18 years old, we’d have to start saving right now. Please note that we’re saving for children we only plan on having in the next five to seven years. What I also realised was that saving without financial literacy was as good as just putting money away under a mattress. Do we understand which investment plans work for what goals? What about a balloon payment for a car? What do we have in mind when picking a property to purchase?
All of this is crucial information and truly speaking, saving, won’t take me out of poverty.
Abenathi Gqomo
