South African households prioritise financial support for loved ones during lockdown

Not being able to provide family and friends with financial assistance during lockdown was the number one concern for South African households surveyed in the latest Momentum/Unisa Household Financial Wellness Insights Report.

In a country where familial financial responsibility is culturally weaved into the makeup of so many of our households, the idea of not being able to help your family or friends who rely heavily on this financial support can create significant stress.

This is according to Financial Planner at Momentum, Janine Horn who says the lockdown was a major wake-up call for many South Africans. “The data shows that only once households realised that they could not control the greater economic situation, did they start to take an interest in their finances in an effort to maintain the financial support for their loved ones.”

The study revealed that households concerned with continuing to support their friends and family had to make some adjustments by reorganising and changing their spending behaviour – via increasing their online shopping, cutting back on spending and reviewing their financial goals.

“It shouldn’t take a crisis for us to kickstart our planning,” says Horn. “And by understanding our financial priorities – such as supporting loved ones – we can set achievable financial goals.”

Don’t let family bring you down – plan to lift them up

On the latest episode of the VIA money show Geldhelde, Deputy CEO of Momentum Metropolitan, Jeanette Marais said, “It often happens that we put the needs of our families and friends before our own. Although that is very selfless, it’s a decision that should be reconsidered if our expenses to solve for their needs derail our own financial goals. Charity begins at home.” Jeanette use an analogy to explain: “It is similar to an emergency on a plane. You have to put your oxygen mask over your own face, before you help your family and friends around you.”

Horn agrees with Marais and says that this just confirms the importance of proper planning in the journey to financial success: “You can’t support those you love if you aren’t planning effectively for yourself first as the breadwinner”.

Horn provides some tips to help you gain some much needed financial momentum so that you can make good on your financial responsibilities. “And it starts with setting up the right short- and long-term financial goals,” she says.

How to set up financial goals

Horn advises to always remember that the definition of financial success is to simply have goals and work towards achieving them. The problem is that a general desire for financial success is very vague, she says you need to be specific and realistic in setting financial goals. ‘

“The more specific your goals, the more likely you are to achieve them. Both long-term and short-term goals are important, but even more important is having a blueprint for achieving such goals.

She reminds us never to forget to consider your dependents or loved ones when you are planning your finances, “you don’t want them to have financial stresses and debt burdens when you are no longer around.”

Horn provides a few examples of some goals you can and should work towards:

• Build up an emergency fund

• Get out of debt

• Live on less than you earn

• Spend less and save more

• Set medium and long-term savings targets

• Start thinking of retirement (no matter how young you are)

There’s no substitute for the right advice

By obtaining the right professional advice in the budgeting and financial planning process, Horn says you can also understand what financial products can do for you when it comes to lending, saving and insurance in order to reach financial goals.

Catch the next episode of Geldhelde on Via (DStv channel 147) on 1 March 2021 at 19:30 and get more #FinancialAdviceForSuccess from Momentum.

ENDS