Aubrey Faba, Channel Director for the Red Channel at Momentum Financial Planning

 

 

South Africa’s youth face mounting uncertainties ranging from the financial to the social to the political. During Finance Minister, Enoch Godongwana’s recent Budget Speech, and across all economic announcements, much discussion and debate is stirred, but it still leaves many young South Africans wondering: What does this mean for me?

 

 

For instance,  recently announced marginal GDP growth of 0,1% saw South Africa narrowly escape a recession. According to Aubrey Faba, Channel Director for the Red Channel at Momentum Financial Planning, it is imperative that we dissect how these kinds of numbers and statistics translate into tangible outcomes for South Africa’s youth. That way, Faba says South African youth could actually translate events like the Budget Address into tangible ways forward. But where do they start?

 

 

“One of the most pressing concerns is the escalating debt service costs, which are set to absorb more than 20 cents of every rand collected in revenue. This means there might be less funds available to spend on crucial areas such as education, healthcare, and youth-oriented programmes,” says Faba.

 

 

He says another notable aspect is the sin tax increases (or excise tax as it is officially known). Alcohol and tobacco products were increased above inflation for most products. While these measures are aimed at alleviating fiscal pressures, Faba says they could potentially strain the finances of young individuals already grappling with the high cost of living.

 

 

All these factors can leave young people feeling discouraged; however Faba says, there are ways young people can stay on top of their finances despite this challenging time. Faba recommends the below proactive financial management strategies young people can use to safeguard their finances.

 

• Financial literacy: By recognising the importance of understanding financial concepts and tools, young people can actively seek out resources and educational opportunities to enhance their financial knowledge.

 

• Budgeting and saving: The importance of budgeting and saving cannot be overstated in turbulent economic times. Young South Africans should adopt disciplined saving habits and create emergency funds to cushion against unexpected expenses or income disruptions.

 

• Additional streams of income: Entrepreneurship is emerging as a viable pathway for young South Africans to secure their financial future. With the rise of the gig economy and online marketplaces, young people can leverage their skills and creativity to start businesses or freelance ventures.

 

 

Faba notes that understanding these economic developments can be tricky, especially for young people new to financial matters. That’s why he believes it is crucial for them to seek guidance and advice, regardless of their age. For Faba, financial advisers play a critical role in providing valuable insights and strategies tailored to individual circumstances.

 

 

“Whether it’s managing personal finances, planning for the future, or making investment decisions, seeking professional advice can help pave the way for financial success. The world of money moves so fast, and our youth need to find every advantage they can. Let them empower themselves to make informed choices and secure their journey to success through financial advice,” Faba concludes.

 

 

ENDS