Despite the cost-of-living crisis, 82% of more than 2,000 respondents in a recent Budget Insurance survey said they are able to save money, albeit small amounts. While the amount of money being saved is not substantial due to the cost-of-living crisis, 47% of those who can save, do so to be able to cover unforeseen emergencies.
“The pandemic taught us that those rainy days are possible, and that they are hard and taxing on our monthly budgets. South Africans know this and are putting aside whatever funds they can to cushion unexpected blows,” says Susan Steward from Budget Insurance.
“Those not able to save money blame the rapid rise in the cost of essentials (40%), unplanned emergencies (13%) and family obligations (12%).”
The survey respondents shared some hacks to help other South Africans make saving money possible. Daily Maverick Insiders also had tips to add:
- Car pool: Thirty-six percent of respondents are currently car pooling to and from work to ease the petrol price burden. “Keep in mind that there are insurance implications if you do choose to use your own car to ferry fee-paying passengers,” says Steward.
“Insurance will cover lift club cars as long as the activity of giving lifts to people is not a source of income to the insured – for example, an airport shuttle service. Make sure to contact your short-term insurance provider to check the terms and conditions of your contract.” Your passengers can contribute towards your petrol costs.
Daily Maverick Insider tip: Slow down, drive below the speed limit and plan ahead so you make fewer trips.
- Review your insurance annually: Shop around annually to make sure you are getting the best premium. Make sure to compare apples with apples when it comes to insurance cover and check details such as the excess amount you have to pay when claiming, and whether or not you have a car hire option.
Daily Maverick Insider tip: You can increase your excess payable to reduce the monthly premiums you pay.
- Stockpile: Look out for and take advantage of discounts and specials. By buying more, at a lower price, you’ll be able to stretch your rand and shrink your monthly shopping bill.
Daily Maverick Insider tip: You may find it cheaper to order online so that you stick to a list and have groceries delivered to save on petrol.
- Buy discounted produce: Another tip offered was to buy fresh produce late afternoon, just before closing time, as it is cheaper. Woolworths, for example, has a “sell by” and a “use by” date on its meat products. However, after 2pm the meat products that are marked “sell by” for that date are marked down by 30%, which can be a huge saving.
Daily Maverick Insider tip: Increase your intake of beans, lentils and eggs to cut down on meat purchases.
- Budget and stick to it: List your fixed expenditures and other monthly deductions and then tally these up against your income. If you do have some money left over every month but believe you should be saving more, draw up a budget to stick to. A survey respondent suggested the 50-30-20 principle where she divides her income into three categories – needs, wants and savings. The 50-30-20 plan means that you count expenses such as rent, electricity, water, transport and groceries as a need. Then, you aim to spend no more than 30% of your after-tax income on wants. The rest can go towards saving for retirement or other financial goals.
- Piggy bank: Many survey respondents noted that they collect any loose, small change and then frequently bank that change to avoid spending it. It all adds up.
Daily Maverick Insider tip: Take five-minute showers instead of baths and switch the geyser on for only two hours a day.
- Cook instead of buy: Another saving hack was cooking food at home instead of purchasing takeouts, with one respondent saying: “I always bring a homecooked lunch to work instead of buying takeaways. My weekly meal plans cost under R300.”
Daily Maverick Insider tip: My three dogs cost a fortune to feed. I now use half the kibbles and supplement with left over rice and vegetables.
- Prepare in advance: “I use a gas stove and an open fire to cook, and also precook meals, then freeze them in batches. It helps me save a lot on electricity.” Another respondent said: “For my vegetables, I have a vegetable garden. I buy winter clothes in spring and summer clothes in winter, when they are on special.”
Daily Maverick Insider tip: Freeze leftover scraps for soup at month-end; replace kitchen roller towel with reusable cloths cut from old clothes.
- Focus on your needs; adjust your wants. Be honest about your debt obligations and your expenses so that you have a clear and realistic picture of your financial situation.
- If you can’t buy it cash, you can’t afford it. This rang true for many respondents who said their needs are more important than their wants. One suggested keeping your credit card for emergencies only, and make the decision to pay for goods and services with cash or debit card only.
- Debt: Pay off your debt obligations first, starting with those with the highest interest rates.
- Bank wisely: Check your bank fees carefully and look at the interest you earn on your savings. Could you be spending less or earning more? Research what other banks offer and look at other ways to invest your money.
Daily Maverick Insider tip from Candice Paine: Check that you are not paying for streaming services or apps that you don’t use. BM/DM
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