South Africans are constantly reminded of how terrible they are at saving. We are rated among the worst nations in the world for our profligate ways, and our purported inability to put away our hardearned pennies. Yet, contrary to what many believe, it’s not the lower-income earners who give us such a shoddy reputation as savers. As the Old Mutual Savings & Investment Monitor of July 2012 revealed, lower-income South Africans save more than higher-income citizens, despite the fact that their living expenses [proportionally] place a greater demand on their household incomes. Indeed, as a result of their penchant for fancy homes and even fancier cars, higher earners shoulder a larger debt load than lower earners.
Perhaps another secret to the savings success of SA’s lower-income households is their use of stokvels as a savings instrument. According to research provided by African Response, almost 11.5m people belong to 811 830 stokvels around the country, and they collectively save R44bn a year. This number, as researcher Zinzile Ntoyiwa pointed out, “clearly dwarfed most major metropolitan areas”. Stokvels – def ined by Andrew Lukhele,