Spender or Saver – which one are you?
It’s no secret that many South Africans are big spenders but not big savers.
Recently the Fund rolled out a Financial Wellness programme of 5 steps to encourage you to re-examine your relationship with money. You can find these steps on Imbizo or on www.wgrf.co.za.
IT’S NOT HOW MUCH MONEY YOU HAVE, BUT RATHER WHAT YOU DO WITH IT THAT COUNTS.
What is conspicuous spending?
CONSPICUOUS SPENDING IS WHEN WE SPEND MONEY TO BUY LUXURY GOODS FOR ‘STATUS’ AND TO ELEVATE OUR SOCIAL STANDING.
Whether we like to admit it or not, we’re all guilty of buying things we don’t need in order to keep up with those around us.
WEALTH IS NOT WHAT YOU SPEND, IT’S WHAT YOU SAVE.
The biggest problem with this trend is that we tend to spend money to gratify our immediate wants, rather than long-term needs like buying a house or saving for retirement.
To quote Steven Nathan, the chief executive of 10X Investments:
‘When my children have referred to other people as richer than us, I say to them: We don’t know that. What we do know is that they spend more than we do.’
We get trapped!
How do we find ourselves in this position and why is conspicuous spending becoming such a damaging trend?
Change this mindset
Not everyone is a natural saver, therefore education is the key to teaching young people to change their attitudes.
We need to make young people more mindful of the future and teach them that happiness today may come at the cost of financial unhappiness tomorrow.
Early education makes young people better equipped to make the right financial decisions. They need to understand what budgeting is, how interest works and how to plan for the future so that their money grows.
Role models can also change the mindsets of young people and can use social media to send positive messages about saving rather than conspicuous spending.