Check Yourself Before You Wreck Yourself
The South African economy has been going through somewhat of a rough patch lately, oh who am I kidding, we’re on a downward spiral. According to stats SA the South African economy is responsible for the loss of 51 000 jobs in all sectors in 2016 alone. Among those 51 000 there are millennials who were probably new to the workforce and had not even begun saving, or the seasoned worker who thought they were secure in their employment and wouldn’t have to have a rainy day fund, at least not just yet. Which leaves a small percentage who started saving since their pre-pubescent years. The challenge is getting all young people to jump on this bandwagon. In order to do so it’s important to understand their mindsets around money and financial institutions.
We just came from youth month (June), we’re now in savings month (July). There are a number of young people who are probably aware that this month is all about emphasizing the importance of saving and its many facets. Then there are those who aren’t aware about savings’ month, and that’s ok because you live and you learn right? Some of us grew up with some sort of a “savings plan”, be it a piggy bank, under your mattress or even an old shoe (yeah this was a thing). Those were the beginning stages of our parents trying to instill certain values revolving around money and sometimes our parents weren’t the ones teaching us, we picked the habit up at school or through friends. But it becomes a problem when that system is not monitored, maintained and you have no idea why you’re saving or what you’re saving for. For example in my younger days, I had a piggy bank, I would save up for something I wanted and then spend every cent I had once I had saved up enough. So the cycle continued until recently actually. Why do we keep delaying the saving process in this hostile economy?
According to thefinancialbrand.com and the studies they conducted with big players in the financial industry these are the following reasons why we (millennials) are so terrible with money. The first one is we’re in denial, we say we’re saving or planning to start saving but the reality is we’re not and to make matters worse we’re spending money we don’t have, living way above our means. Secondly we are terrible with budgets, it’s either we can’t stick to our budgets or we don’t know where to begin putting one together in the first place, there is a silver lining though, millennials are open to getting assistance in this department. Thirdly we trust our friends and family over financial institutions, the perception is that banks and financial institutions are out to get our money, whereas taking advice from a family member or friend is more comforting as these people have often made mistakes and have quite a bit of experience under their belts. The fourth point is millennials are aware that financial institutions are clueless about how to talk to them, this feeds into the trust issues, one person said “I don’t think my bank understands me as a human being…it’s just a hole where I throw my money into”. We need to start bridging the gap between them and us but they really do have to try meet us halfway.
It’s not all doom and gloom, as much as most millennials are drowning in debt, struggle to understand what half the fees on their statements mean and absolutely hate the jargon these bankers use, we are keen to reach our financial goals. The ultimate goal is to retire comfortably or work because you want to and not because you have to.