It is often said that financial freedom is only for the upper class and not for the average citizen. This insight is a notion that financial services provider, Ithala SOC Limited, is trying to dispel.
“July is a savings month and this calls for all the institutions to raise awareness on financial management and topics around key aspects of saving’, says Sandile Xolo, Head of Marketing and Communications for Ithala SOC Limited.
“Having access to money and financial freedom comes with the need to manage your finances and ensure that debt does not overburden or destroy your ability to create wealth,” he said.
According to a report released last year by the National Credit Regulator, there are 25 million ‘credit-active’ consumers in South Africa, 10 million were behind in their loan repayments. Even the World Bank has deemed South Africa to be the most indebted country in the world.
A report compiled by Debt Rescue based on a year-long research shows that only 23% of South Africans have money left at the end of the month. Most people battled because of debt repayments, with more than half of consumers using 75% of their salary to make debt repayment.
Ithala believes over-indebted consumers must engage in some serious introspection and must exercise strict financial discipline if they are to comfortably make ends meet.
While Xolo believes that reducing debt, saving and investing to ultimately enjoy financial freedom rests entirely with each individual, he says that access to the right information will result in more informed choices and an improved standard of living. The organisation believes that educating people about money and providing the necessary tools to manage money can help to address the triple challenges of poverty, unemployment and inequality. Ithala regularly undertakes initiatives that help promote financial literacy in communities and encourage a spirit of saving.
“Often what makes financial freedom unattainable and pushes most people into debt is the lack of financial illiteracy which leads to poor consumption driven decisions,” said Xolo. Equipping people with key financial literacy skills as early as possible at school level can enable them to make sound future decisions regarding their money.
To assist people, save and improve their wealth, National Treasury in 2015 introduced tax free savings accounts to be offered by banks, life insurance companies, collective investment scheme managers, Linked Investments Service Providers (LISPS) and authorised users to the public. Tax free savings accounts are a way of encouraging more individual saving and investment.
For the past 60-years Ithala has been at the forefront of creating special offerings that will help people save as a means to accumulate personal wealth and economic freedom.
“Investment is an important vehicle for financial freedom. Hence, much needed guidance on financial planning coupled with a savings culture will yield positive returns for ordinary South Africans. Our mission is to instill and promote the culture of savings and urge our fellow South Africans to start their journey with Ithala.,” said Xolo.
A current distribution network of 38 branches in KZN provides convenient transacting facilities. Ithala offers a comprehensive portfolio of corporate and personal banking solutions.
For more information visit www.myithala.co.za, call 031 366 2500 .
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