It’s getting tougher for us to make ends meet every month. The cost of living is climbing, we’re borrowing more to bail ourselves out, and while many of us do have a monthly budget, 76% of us still run out of money before the end of the month.

This is one of the key findings in the World Wide Worx “More Month Than Money” survey commissioned by TymeBank in an effort to get a deeper understanding of the challenging financial realities that South Africans face today. The report, released during National Savings Month, shines the spotlight on what we do with our money, the debt burden we sit with and how many of us are able to save.

“We know that many South Africans struggle to save, but through sharing the insights from this study, we hope to help consumers take control of their money so they can work towards their goals and reach their full potential,” says Tauriq Keraan, Deputy CEO of TymeBank.

43% of us borrow money to get through the rest of the month after we run out, the study reveals. Only 9% of those surveyed turn to banks to help them make it through the month, 20% of us use our credit cards and 59% of us resort to borrowing money from family and friends.

“Turning to those close to us may seem like a viable option but the fact is our family and friends are perpetuating our predicament; as we have to keep relying on them to keep us financially afloat. Within black cultures this is particularly true thanks to black tax; where those who earn a salary are expected to share it with family members in need, until they themselves have nothing left to save or invest,” says Gerald Mwandiambira, acting CEO of the SA Savings Institute and director of The Financial Planning Institute of Southern Africa.

Giant gender gap

Women are the hardest hit. Expected to take care of their children as well as other family members, the survey reveals that 59% of women run out of money before the end of the month, compared to 56% of men. Black women are the most likely to do so (64%).

“Over 60% of households in South Africa are fatherless, meaning all the financial responsibilities fall onto the mother. Add to this the fact that women earn 27% less than men, they are carrying a very heavy load and the money they do earn has to plug many holes,” says Mwandiambira.

This could also explain why women are the best budgeters: 80% of women aged between 25 and 45 budget, versus the country average of 37%. “With so many mouths to feed they have to make the money go further,” Mwandiambira adds.

Priorities and luxuries

So where is our money going? Housing (41%) and groceries (24%) are the first things we spend our money on. This is followed by transport costs (10%) and school fees (8%). Spending on clothing and security come in last.

“The survey shows that our priorities are in the right place, as we’re spending on the Big Three first – housing, groceries and transport,” says Keraan. “However, it also shows that while debt is not the first expense to be paid, it constitutes a major portion of our monthly expenditure.”

40% of us are spending between 41 – 100% of our monthly income on servicing debt, this includes bond repayments, loans, store cards and credit cards. If we’re married or have moved in together, and earn more than R10 000 a month, this is most likely to be our reality.

After paying these big ticket items, 57% of us don’t make it much further into the month; by the 15^th we’ve run out of money and are back to borrowing. This makes us feel frustrated (51%) and helpless (35%).

And while 24% of us are self-disciplined enough not to purchase any luxuries with the money we borrow, the rest of us keep on buying non-essentials even when we’re broke: 17% buy takeaways, 16% go clothes shopping, 12% socialise, 12% eat out, 11% buy alcohol and 5% get their hair and nails done.

Turning the tables

“It can be very overwhelming to cut back on everything at once. So start small, even if that means putting away an extra 5% here or there. These small changes can make a big difference. Getting started is the hardest part,” says Sam Beckbessinger, best-selling personal finance author and entrepreneur.

Armed with this insight we can begin to make a number of small changes in different areas of our lives – finding places where we can trim down on our monthly expenses without having a major impact on our lifestyles, such as opening an account with TymeBank and paying no more monthly bank fees for example.

This approach will serve us well as, despite our day-to-day financial realities, we all still have goals we aspire towards; we want to save up for a car (19%), to study or learn a new skill (19%), to start or grow a business (11%) or to buy or renovate a home (9%).

“The research shows us that, despite our tough economic environment, 43% of us are still saving towards our goals, which is really encouraging,” says Keraan.

And of those who do save, 67% of us use a savings account. “We all want to improve our lives, and it’s positive to see that some of us are making a plan to put a little bit away each month in order to turn our dreams into realities. Even saving 5% of our income is a step in the right direction, and when we choose a bank that backs us with high-interest rates, we can reach our goals that much faster.

“Add to this the power of saving smaller, incremental amounts throughout the month, and earning interest and compound interest on our savings, we do have the ability to turn our financial situations around. It requires a rethink of how we spend our hard-earned cash, at times a step-change in lifestyle choices and even about how we bank, but it can be done,” says Keraan.

For more guidance on how to turn your financial anxiety into financial freedom visit https://www.tymebank.co.za/brokeby-stories.

To download the report, click here.