IT IS important for parents to encourage their children to start saving as early as possible.
Since the month of June is dedicated to the youth, the culture of saving needs to be put in the limelight among the values that need to be taught to the youth.
This is the view of John Manyike, head of financial education at Old Mutual.
The recently released Old Mutual Savings Monitor indicates that 31percent more people in the 18-24 age group are saving than last year, but that South Africans in general are not saving enough.
"It's no secret that the prevailing consumer culture, the media and advertising have an enormous influence on how people - in particular the youth - spend their money.
"This is compounded by peer pressure, which affects impressionable youths more than adults. It's all about attitude and habits and setting positive examples," Manyike says.
"Peer pressure is normally thought of as something negative, but if those individuals in a group who have the most influence set a positive example by starting to save money on a regular basis the rest of the group will follow," he says.
"Most people intuitively understand that they need to save 'a little bit' at the end of the month. But this often does not work as there always seem to be other expenses that eat into whatever is available.
"Failing to get into the habit of saving regularly (early) is one of the biggest reasons why people do not become financially secure."
Manyike says this leads to people becoming dependent on the state in their old age.
He says governments all over the world are increasingly under pressure to settle national debts. He says a state-dependent nation has a negative impact on governments' ability to sustain social welfare payments in the long term.
About 14million South Africans receive some sort of state aid.
Manyike says even if people started with a small savings amount monthly, that would develop a savings habit.
Here are some tips to save:
- Young people receiving pocket money from their parents should ask them to hold back a portion at the beginning of the month that should go automatically into a savings account.
- Ask your employer to deduct the money from your salary and pay it into your savings account or investment each month.
- Ask your bank to arrange a stop order against your account.
- Sign a debit order in favour of the investment manager of a unit trust fund that ensures higher returns above inflation and more than what an ordinary bank savings account would give you.
Start saving at young age
IT IS important for parents to encourage their children to start saving as early as possible.
Since the month of June is dedicated to the youth, the culture of saving needs to be put in the limelight among the values that need to be taught to the youth.
This is the view of John Manyike, head of financial education at Old Mutual.
The recently released Old Mutual Savings Monitor indicates that 31percent more people in the 18-24 age group are saving than last year, but that South Africans in general are not saving enough.
"It's no secret that the prevailing consumer culture, the media and advertising have an enormous influence on how people - in particular the youth - spend their money.
"This is compounded by peer pressure, which affects impressionable youths more than adults. It's all about attitude and habits and setting positive examples," Manyike says.
"Peer pressure is normally thought of as something negative, but if those individuals in a group who have the most influence set a positive example by starting to save money on a regular basis the rest of the group will follow," he says.
"Most people intuitively understand that they need to save 'a little bit' at the end of the month. But this often does not work as there always seem to be other expenses that eat into whatever is available.
"Failing to get into the habit of saving regularly (early) is one of the biggest reasons why people do not become financially secure."
Manyike says this leads to people becoming dependent on the state in their old age.
He says governments all over the world are increasingly under pressure to settle national debts. He says a state-dependent nation has a negative impact on governments' ability to sustain social welfare payments in the long term.
About 14million South Africans receive some sort of state aid.
Manyike says even if people started with a small savings amount monthly, that would develop a savings habit.
Here are some tips to save:
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