South Africa’s Abysmal Aversion to Savings

The Corporate Dungbeetle

The media is saturated with the celebration of superior wealth. We live in an era where materialism has been crowned the supreme virtue. Is it any wonder that youth culture has fallen sway to the appeal of exuberant flash? In an age of rampant consumerism, the lavish life has become the key marker of success, foregoing ideals such as legacy, purpose and vision. The frenetic race for material success has left young people yearning for instant gratification.

In compulsively seeking to fulfill this need to instantly appear and feel successful, young people are caught in a self-defeating cycle, which may well leave their futures devoid of basic financial stability, let alone wealth. The resulting social milieu is one of towering debt, people toiling as cogs in machines, alienated from their true potential and living above their means. This darker underside of materialistic youth culture may have been aggravated by the deregulation of financial institutions during the 1980s and the elimination of credit ceilings. Domestic savings levels in South Africa have shown a downward trend for the last two decades.

It calls for a paradigm shift in the mindsets of the youth. But, the usual reasons for saving have become commonplace: medical emergencies, sudden job loss, retirement funds, down payment on a house… Youth culture is aware of all this. Yes, you might suffer a heart attack and you will get old and eventually need care, but these are not the only reasons to save. These are reasons steeped in the banal and abstracted by an uncertain future. They don’t speak to the youth as they stand in the present. So, for the moment, let’s forget them and focus on the more compelling ones.

Why should we really question extravagant spending? The answer is the dream. Whether it’s to restore a vintage Ferrari, provide for a stable family, own a multi-national franchise, have a fairytale wedding, open a coffee shop, start an NGO, innovate the next big invention or launch your latent idea for a start-up company, the answer is the dream. We are often told that dreams need perseverance. We are rarely informed of the reality that dreams need funding.

The other reason is to accommodate the human whim: that unpredictable impulse to suddenly give up everything and become a musician, to leave your career and go write a novel in Spain. Savings gives you the freedom to completely alter your career path, reinvent who you are, where you are and what you do. And this is hugely empowering. Savings can unlock the rigidity of life, and allow you to dabble in a palette of possibility. It allows you flexibility to be the architect, not only of your future, but of your present.

A Savings Culture is what makes dreams and whims, however big, however absurd, however radically individualistic or socially transformative – possible to execute. And this is why young people, all people, should save: for that fire, that human conviction to do something extraordinary with your life, so that when the impulse hits, the funding is there.