Approximately 27 percent of the South African workforce is currently unemployed. With the economy in such a bad state, many South Africans are feeling the financial strain.
And there might be even more financial trouble ahead for the country’s millennials.
Young and inexperienced, millennials know little about managing their personal finances. Couple this inexperience with financial crisis and you get disaster and a bleak outlook.
But there’s still hope for millennials. They can still learn to manage their money and educate themselves on the best financial practices.
In order to do so, however, they must first understand why the financial outlook is so bleak for their generation…
A Financial Outlook for South African Millennials
So why exactly is the financial outlook for South African millennials so dismal?
There are several contributing factors, the first of which is South Africa’s weak economy. The rand recently lost its 10 percent gain against the dollar.
And, to make matters worse, foreign investors have given up over 35.3 billion rand’s worth of South Africa’s bonds.
But there’s another problem as well:
Many millennials just don’t know anything about their finances.
HuffPost reports that only 7 percent of millennials have ever taken courses or sought out resources which would help them learn about their finances. This number is low if you consider the fact that 52 percent of millennials deal with financial stress.
Further still, only 37 percent of millennials have a monthly budget. So young South Africans are struggling to find employment yet aren’t budgeting what little money they have.
Finance for Millennials: The Way Forward
Okay. South African millennials are struggling to get by. But what can be done to alleviate their financial problems in the coming years?
Here are some possible solutions:
Some of the problems millennials currently face stem from the fact that they don’t know how to manage their finances. They don’t seek out the information which would help, and they don’t budget well.
If they received some sort of financial education, they could save more money each year.
Which brings us to our next point:
About 66 percent of millennials plan to rely on their savings to carry them through old age. If they plan on relying on their savings, they’re going to need to make some smart investments.
By investing what they manage to save.
They should start by paying their debt. Many millennials carry around a lot of student loan debt. Paying these loans off would help millennials save money in the long run.
Credit card debt is another problem for many South Africans. There has been an increase in the number of South Africans whose credit card accounts are months in arrears.
After millennials have addressed their debt, they should begin investing in stocks and anything else which will generate returns.
How Can You Stay Out of Financial Trouble?
Millennials have a tough road ahead of them. Financial predictions show that they’re in for some financial trouble in the near future.
But all hope isn’t lost. Millennials who seek out financial literacy will have an easier go of things.
So if you’re a millennial who’s struggling at the moment? Don’t worry. Better days could be ahead.
In the meantime, just worry about securing the funds you need to care for yourself. Just fill out one of our instant applications if you need help getting by. We’ll work with you to get you up to R8,000.