Why save for retirement?
The state old-age grant is a fraction of most people’s current expenses. The sooner you can picture your future self, the easier saving for them becomes.
The South African government’s old age grant is around R1,900 a month. Most people already spend more than that on a car payment, a weekly grocery shop, or a weekend away — which makes it worth asking honestly whether that is a standard of living you would accept, and if not, what the alternative actually requires.
Why the future feels optional
With rent or a bond, schooling and day-to-day survival all competing for the same salary, saving for a retirement decades away tends to fall off the list. Once the monthly expenses are covered, the needs of our present selves usually outrank the needs of a future self we cannot yet picture — and the local statistics bear this out: various surveys suggest only a small minority of South Africans will be financially independent by the time they retire, with the rest depending on family or the state pension.
The stranger you’ll become
One of the biggest barriers to saving is psychological, not financial: research suggests we tend to think of our future selves as strangers, which makes saving feel less like providing for yourself and more like handing money to someone you have never met. Framed that way, it is not surprising saving loses out to today’s priorities.
This article is general information and not advice. Silke Financial Services is an Authorised Financial Services Provider, FSP No. 12462.