Here’s The Number Of South Africans Who Are Adequately Pepared For Financial Crisis

financial crisis ahead

source: thefinancialphysician.com

New research published by financial services group, Old Mutual, shows how many South Africans are adequately prepared for a financial crisis.

The survey revealed that half of the households covered would be able to find money to cover R1,000 in unforeseen expenses, while only a quarter could manage R5,000, with the rest turning to debt accrual.

Alarmingly, however, one third of the households said they could not even borrow enough money to cover R10,000 in unforeseen costs.

Broken down further, for those households earning between R6,000 to R19,999 57% would need to borrow the funds to cover a R10,000 shock, while for those households earning between R20,000 to R39,000, the percentage drops to just under half.

According to financial services firm, Alexander Forbes, what the numbers suggest, is that there’s a disturbing number of employees in the country that are ‘just one destabilising shock away from hardship’. The lower the income, the more pronounced the hardship is likely to be.

Ability to handle expenditure – R6,000 to R19,999 monthly household income

R1,000 R5,000 R10,000
Pay with a credit card  7%  6%  3%
Personal loan  3%  26%  51%
Borrow from friend/family  31%  17%  2%
Borrow from my stokvel  8%  9%  4%
Use savings  50%  34%  8%
Could not handle it  0%  5%  30%
Will have to borrow 42%  52%  57%

 

Ability to handle expenditure – R20,000 to R39,000 monthly income

R1,000 R5,000 R10,000
Credit card  25%  27%  13%
Personal loan  1%  11%  34%
Borrow from friend/family  12%  12%  9%
Borrow from my stokvel  5%  8%  5%
Use savings  51%  39%  25%
Would not be able to cover it  0%  2%  11%
Will have to borrow 18%  31%  48%

Alexander Forbes noted that a US survey showed that 47% of Americans would be unable to pay for a $400 emergency without borrowing or selling something.

 

Source: Business Tech

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