It’s no secret that South Africa is facing a retirement crisis. According to Lynette Uys, Financial Coach and Retirement Benefit Counsellor at Momentum Corporate, only 6% of the population on track to retire comfortably, but what about the rest of the workforce?
How are they supposed to navigate this perpetual maze and make it out the other side with enough to get by for the indeterminable rest of their lives? For most employed South Africans, Uys says that all begins with benefits.
“Financial strain often forces employed South Africans to dip into their future savings to survive today,” says Uys. “With the two-pot system on the horizon, this is going to be even easier to achieve – which is a danger to your future financial security.”
However, with a plan and self-discipline, Uys believes there are ways to preserve your income for the future while managing current financial demands.
Uys provide seven essential strategies to help employed South Africans strike that balance:
1. Understand your motivations – your WHY
Developing discipline starts with understanding what drives your behaviour is a critical skill for financial foresight and peace of mind. Uys advises reflecting on your financial habits and identifying the underlying motivations.
“Learning to understand your ‘why’ is crucial,” says Uys. “This self-awareness is the foundation for making better financial decisions and juggling the needs of the now versus the needs of the future.”
2. Set clear financial goals
Having specific, measurable goals can help you stay focused on what truly matters on your own journey to success.
“Decide what you want to achieve financially in the short and long term. Whether it’s building an emergency fund, saving for a home, or planning for retirement, clear goals provide direction and motivation,” says Uys.
3. Seek professional financial advice
Ensuring you have objective financial advice is essential. She suggests consulting with Retirement Benefit Counsellors who can provide guidance tailored to your needs. With intensive new regulations like the Two-Pot System, Uys says employed South Africans have an even greater need to tap into the right advice.
“Financial advisors can help you navigate complex financial landscapes and make informed decisions. This is particularly important when it comes to navigating the complex maze of employee benefits, that seldom get used to their full potential,” says Uys.
4. Leverage available resources
Don’t be intimidated by financial planning, without it you will never make any progress. Uys suggests utilising the resources available to you, including any resources provided by your benefits provider such us Momentum’s ‘Member Hub’, which provides a wealth of advice and information pertaining to each member.
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These platforms offer valuable information on preserving your retirement savings and making informed financial choices,” says Uys.
5. Make healthy habits a priority
It may not seem like it, but Uys says the truth is that healthy bodies strengthen healthy minds. By incorporating more healthy habits into your life, you can significantly impact your financial discipline.
“Try scheduling some exercise into your routine to boost mental resilience and clarity. Simple changes, like choosing a walk over watching TV, can enhance your ability to make disciplined decisions, which includes the financial variety.”
6. Prepare for the unexpected
While discipline is crucial, Uys says it’s also important to acknowledge life’s unpredictability. The make up of our benefits are very dependent on our ability to apply agility and pivot where necessary.
“Build a financial cushion to handle emergencies without derailing your long-term goals. This preparation can help you stay on track even when faced with unexpected expenses.
7. Educate yourself continuously
With new regulations and milestone moments in our economy, Uys believes it is imperative to stay informed about financial matters to make better decisions.
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