As South Africa commemorates Youth Month, a recent nationwide survey by Old Mutual, in collaboration with the Technical and Vocational Education and Training (TVET) colleges, has revealed concerning financial habits among students.
The findings show that although the majority of students are confident in their financial abilities, most do not have the skills or discipline to budget or manage debt effectively.
The survey, part of Old Mutual’s Financial Wellbeing Programme, included 727 students aged 18 to 25 and revealed that while 72% of respondents felt confident in their ability to manage money, 78% admitted they don’t know how to budget properly.
“The survey findings show that there is a marked discrepancy between students’ perception and reality,” comments John Manyike, Head of Financial Education at Old Mutual. “While most students feel they are in control of their money, the fact that the majority of them don’t budget properly would indicate otherwise.”
Only 22% of respondents said they both had a budget and stuck to it. Another 52% said they had a budget but didn’t always follow it, while 25.7% claimed they don’t have time to budget.
Worryingly, financial pressure is impacting academic attendance. “Over 14% of those surveyed said they sometimes or often miss classes due to financial difficulty,” says Manyike.
“Unfortunately, many young people feel that they don’t have a good handle on their debt and need help understanding how to gain control of it,” he adds, noting that 11% of a smaller group of 249 students reported having debt, with 20% of those saying they’re not coping.
The report also highlights the lack of a saving culture, with only 28% of students saving regularly. “Protecting and investing your wealth is another lifelong habit that we highlight in our training,” says Manyike. “Many feel they don’t have enough money to save or invest, but the truth is that the earlier you start on your investment journey, the better – and every little bit counts.”
Despite the troubling figures, the research offers hope. Pre- and post-training assessments showed an increase in financial confidence from 41% to 57% and financial knowledge from 28% to 48%.
“This makes a strong case for the value of financial education in helping young people make informed decisions and build financial resilience,” concludes Manyike.
Compiled by Justine Fortuin
