Many South Africans find themselves crawling from payday to payday. Not even wealthy South Africans are walking confidently when it comes to their finances. Rising food prices and increased fuel and travel expenses are just a few reasons why ALL South Africans, wealthy and poor, feel like they are wading through mud financially.
President Ramaphosa shared his big-picture vision for the country’s economy and its people during his recent State of the Nation Address:
““We want a nation where there is work for all. Where every person can earn a decent living and realise their potential. We need to ensure that growth creates jobs for all, especially for young people … We want a nation where no one goes hungry.”
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A strong economy starts with strong personal financial habits. Employers play a vital role in supporting their workforce on their journey to becoming financially healthy.
Why budgeting is the first step to financial health
Most people agree that budgeting is a good thing. If this is the case, then why are so many South Africans over indebted and struggling to make ends meet? When employees struggle with finances, it’s rarely confined to the four walls of their homes. These worries inevitably spill over into the workplace and cause problems such as absenteeism due to psychological stress and illness.
Thian de Beer, CEO of Picsa, a financial services provider that partners with employers to equip low-income workers with affordable financial products and practical education says, “A financially healthy employee is a happier, more productive employee, thereby making financial tools available an investment in your workforce and your bottom line.”
"The promise of instant rewards can often overshadow the importance of saving for the future. To overcome this, it's crucial to shift one’s mindset and take small, actionable steps such as setting achievable savings goals and automating savings to reduce the temptation to spend. By addressing both the economic and psychological barriers to saving, individuals can make meaningful progress toward better financial health."
"Every South African deserves access to savings, affordable insurance, and responsible credit, regardless of income. Our goal is to help people improve financial health for themselves and their families—one step at a time."
Be money smart: 3 tips to prevent financial stress
Whether advising your employees to responsibly work towards their next paycheck or planning for long-term financial goals, these three steps will put anyone on the path toward financial health.
1. Track your income and your expenses
Sometimes, it's difficult for employees to face the reality of the state of their finances, however it's the only way to help them make informed decisions.
Picsa’s free SMART budgeting template is a useful guide to offer your employees to help them track their spending and start saving.
2. Get rid of debt
For your employees to have more money in their pockets at the end of the month, encourage them to take a good look at their current financial situation. Knowing exactly how much money they owe, will help them incorporate repayments into their budget to ultimately get out of debt.
With Picsa’s consolidation loan, qualifying clients can combine all their debts into one manageable monthly payment, thereby reducing fees. Our responsible lending approach ensures that clients borrow only what they can afford.
3. Save for emergencies
One of the consequences of living from payday to payday is that it leaves employees vulnerable to unexpected expenses. Without savings to weather financial emergencies, employees often turn to debt.
Picsa makes saving simple by offering both short-term and long-term savings options that empower clients to take control of their financial health.
Instead of relying on credit or payday loans, our short-term savings option allows clients to start saving with as little as R10 per month, with no minimum deposit requirements and easy access to their funds. For those planning further ahead, our long-term savings ensures their money is safely invested in their own name while growing steadily over time.
By taking small, intentional steps employers can create a ripple effect that strengthens not only the personal financial health of low-income workers, but also the broader economy. A financially secure workforce is a more productive workforce, and when individuals gain control over their money, entire families and communities benefit.
Visit www.picsa.com to learn more about partnering with us to help your low-income workforce thrive.