A little change can make a big difference

Our education system fails to do its part educating us about personal finance, and money is one of those topics that is seldom gets discussed around the dinner table. As a result, we are raising a nation of spenders, so many of whom will eventually become a burden on family, friends or the state.

To some degree, parents should take the blame for failing to teach their children about the importance of saving but, to be fair, they were probably failed by their own parents. So please allow me to step into the uncomfortable shoes of your parents so that we can talk saving.

I have heard all the excuses about why South Africans don't save. Quite frankly, I don't want to hear any more. Unfortunately, with such high unemployment in South Africa, especially among the youth, there are many who do have a legitimate excuse: not having an income. As for the rest of us: If you earn an income you should be saving, no matter how little. Saving is a habit, and the formula is to spend less than you earn.

When I was in Grade 9 I recall watching my mother trade shares through one of the South African bank platforms. I was intrigued as she explained to me how it worked. Since I was privileged enough to receive pocket money I decided that I would invest R100 a month in shares on the platform, just like my mother. My dream of being a teenage investing prodigy perished quickly when my Mum told me that each buy and sell instruction cost R100.

A lot has changed in the decade since. Fees charged by financial services providers have come down dramatically. The minimum contribution for savings accounts has decreased. Various platforms give you the opportunity to invest seamlessly and cost-effectively.

But if R100, or even R10, is too big of a commitment we need to look at how our parents saved before banking accounts were widely available. Sometimes you have to look backwards to move forward. It might be time to get out the piggy bank and start depositing a little change daily. or even weekly.

The petrol attended gets at least R5 every time I stop at the garage to fill up my mother's car. The car guard gets at least R2 when we park on the street. If we stop for something to eat the waiter gets a tip of at least 10%. I know I am not the only one tipping these various service providers; most of us are used to giving away small amounts of money often.

I am not suggesting that you stop giving to others; I am making the point that if you are comfortable tipping a waiter, a petrol attendant or a car guard surely you should be comfortable putting away some small change for your own future.

Start saving or investing, no matter how hard or strange the concept is for you. The hard decisions you make today will make your future so much easier. Start developing the habit to spend less than you earn, no matter how little, and save the difference. A little change can make a big difference, which is true in more ways than one.

Khwezi Jackson
Investment consultant

Khwezi Jackson, a BBA graduate at Tsiba Business School, is an Investment Consultant at 10X Investments

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