Read the full article on Women On Top; we include an extract below.
South Africans have long been considered as being amongst the world’s worst savers for retirement, but the reasons may have more to do with high levels of indebtedness rather than a poor savings culture.
“Most South Africans want to save for their retirement, but the reality for many middle-income South Africans is that once they’ve paid for essentials most of what’s left is spent on repaying debt. Debt repayments make up a substantial portion of what consumers need to spend. That makes saving difficult, if not impossible,” explains Benay Sager, head of DebtBusters.
The company’s most recent quarterly Debt Index found that people applying for debt counselling with take-home pay of over R20 000 per month are spending 60% of their monthly net income servicing debt. Their total debt-to-income ratio is over 130%. While in other countries the total debt-to-income ratio is similar, most of the debt in other countries is low-interest bond debt — in South Africa, most of the debt is high-interest unsecured debt.
Read the full article on Women On Top.
