The importance of savings to secure individuals in the event of uncertainties has been widely acknowledged by South Africans. However, South Africa is still facing a low savings rate compared to other developing countries. The purpose of this study is to investigate the factors that inhibit South Africans from having a culture of saving. Specifically, using a convergent parallel mixed methods approach, the study examined the determinants of the savings rate and explored the view of households on the important factors that cause a low savings rate. The data for the quantitative component employed a merged data set from the National Income Dynamic Survey 2018 and 47 individuals were consulted in qualitative interviews. The results of the quantitative approach provided evidence to suggest that high income, being employed and the highest levels of education are associated with higher savings. Larger household size and older age are associated with lower savings. Females are better at saving than males and the widowed are better at saving than married, single and cohabiting households. From the qualitative thematic analysis, the important factors that cause the low savings rate among households were identified as insufficient income to allow savings, their lack of discipline in managing their spend and the effects arising as a result of black tax repercussions. The study made the following recommendations to ensure that the savings culture in South Africa provides a safety net: entrepreneurial skills training to augment the budgets of low-income earners; financial literacy to be part of the curriculum in schools from the Foundation Phase; mandatory financial training for new employees coupled with incentives for organisations that participate in these initiatives; and innovative savings programmes targeting low-income earners from financial institutions. Finally, it was recommended that the South African Savings Institute collaborates with the Services Sector Education and Training Authority to develop training manuals that could be distributed to organisations.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:uct/oai:localhost:11427/36133 |
| Date | 16 March 2022 |
| Creators | Sekhosana, Sesi |
| Contributors | Alhassan, Abdul Latif |
| Publisher | Faculty of Commerce, Graduate School of Business (GSB) |
| Source Sets | South African National ETD Portal |
| Language | English |
| Detected Language | English |
| Type | Master Thesis, Masters, MCom |
| Format | application/pdf |
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