Young South African workers are feeling the financial pinch

Young South African workers, aged 18 to 30, are financially stressed and struggling to meet their financial obligations.

These are the results of a survey conducted by infoQuest, a South African online research company. Three hundred respondents randomly selected from quotas representing South Africa’s population of young online active adults were interviewed.

When asked to rate their current financial situation on a scale of 1 to 10 (where 1 means “terrible” and 10 means “excellent”), only 15% gave a rating of 9 or 10, while about 40% gave a rating of 5 or less out of 10. The higher the personal income bracket, the higher the levels of financial satisfaction, but even among those earning R20,000 and more per month, only 22% were really satisfied with their financial situation.

Young consumers are also heavily indebted. Two in five (40%) have a personal loan from a financial institution, one in four (25%) have a personal loan from a family member or friend and 17% have an overdraft facility . Those in the R10,000–R20,000 personal monthly income category have the highest incidence of personal loans at 52%. Among those who have credit cards, just over 1 in 3 (36%) have more than one credit card, and in the 18-24 age category, it is 41%. It is worrying that young workers are so dependent on debt, which limits their ability to save, which is so important.

Rising food prices are a major financial burden, with 36% saying they have struggled at some point in the past year to buy food and groceries.

Almost 3 in 5 respondents (57%) had children in school and 32% of them had struggled to pay school fees in the past 12 months.

Other areas where financial pressure has been felt during this period are:

  • 26% struggled to repay their mortgage
  • 29% struggled to pay the premium for their funeral policy
  • 22% struggled to pay their life insurance premium
  • 19% struggled to pay their short-term insurance premium
  • 18% struggled to pay their car loan due date

One in five working young South Africans is a hustler, meaning they have more than one regular source of income. In the 18-24 age group, 23% say they are scammers, while it is 17% in the 25-34 age group. “Young South Africans have had to find ways to supplement their main source of income, and we expect this figure to increase over time as financial pressures are not expected to ease in the near future,” says Heckrath.

Almost 3 in 5 respondents (57%) had children in school and 32% of them had struggled to pay school fees in the past 12 months.

Other areas where financial pressure has been felt during this period are:

  • 26% struggled to repay their mortgage
  • 29% struggled to pay the premium for their funeral policy
  • 22% struggled to pay their life insurance premium
  • 19% struggled to pay their short-term insurance premium
  • 18% struggled to pay their car loan due date

One in five working young South Africans is a hustler, meaning they have more than one regular source of income. In the 18-24 age group, 23% say they are scammers, while it is 17% in the 25-34 age group. Young South Africans have had to find ways to supplement their main source of income, and we expect this figure to increase over time, as financial pressures are unlikely to ease in the near future.

Claire Heckrath is Executive Director of infoQuest. She is an experienced physician with a demonstrated track record of working in the market research industry. Skills in business communication, market research, management, competitive intelligence and business management. Strong business development professional with a degree from Holland Park, London.


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