20 June 2022
Saving money is vital as it provides financial freedom and assists in cases of emergencies, but few South Africans employ a savings culture and have any form of reserves plan in place, preferring instead to live for today.
Commenting ahead of National Savings Month in July, Al Baraka Bank’s Chief Executive, Mr Shabir Chohan, said: “South Africans display a poor commitment to saving, in spite of knowing its importance. Very often we lose sight of the need to save money and spend it in the here‐and‐now. For many this approach to life means losing the opportunity of putting money away to grow wealth and be prepared for financial emergencies.”
“Having a saving plan in place is the primary aspect of building wealth and ensuring a secure financial future and an improved quality of life. Having savings enables you to avoid debt and its associated costs and affords you a way with dealing with life’s uncertainties, supporting you in your hour of need and providing a fall‐back for your family should you experience an unfortunate event.”
Al Baraka Bank has long been a leading driver of savings promotion and actively promotes consumer finance education to encourage more people – especially the young – to save money.
“In this regard, the Bank has undertaken to deliver consumer finance education initiatives at various schools and has been invited by numerous schools to deliver banking presentations. Further initiatives are planned which includes interviews on radio, media articles and social media posts promoting the value of saving from an early age and encouraging parents to initiate savings programmes with their children,” Mr Chohan said.
“It is our goal to contribute towards reversing this tendency and to inculcate in South Africa's youth a greater sense of financial responsibility. We remain fully committed to taking the savings message to as many young people as possible, teaching them the basics of financial literacy, a working understanding of finance and the need to give active consideration to their retirement now, at a young age," he added.
He stressed: “Saving money requires commitment and will involve a degree of sacrifice, but the sacrifice is worth it, because having savings in place will safeguard you against unexpected expenses and, crucially, assist in providing the foundation of a secure financial future.”
“The accumulation of money provides you peace‐of‐mind, enabling you to lead a more stress‐free life, knowing you have the wherewithal to handle unexpected difficulties. Putting money away on a regular basis sets your sights on a better future, enabling you to purchase a vehicle, or a home and accumulate funds for retirement. You are never too young to consider funding your retirement. Savings will also enable you to provide for the education of your children, both at school and tertiary education levels. Whilst every child has the right to a proper education, it comes at a cost and we should all be prepared for such expenses for the sake of our children,” Mr Chohan said.
Savings are not all about long‐term, and having a plan in place enables people to also achieve short‐ term goals, such as holiday breaks, overseas travel, home improvements and the like.
Mr Chohan said: “It is critical that we build a financially‐resilient society in South Africa, one capable of deflecting the effects of crisis situations without impacting on their financial wellness, whilst simultaneously providing for future financial freedom and security."