Financial experts are urging South Africans to focus on reducing debt rather than searching for additional income to save, as economic pressure continues to squeeze household budgets during Savings Month in July.

The National Debt Counselling Association warned that breaking the cycle of borrowing was essential to building a genuine culture of saving.

NDCA Chairperson René Moonsamy says many consumers were caught in a structural affordability problem that made saving effectively impossible.

“The consumer is suffering from what we would call a structural affordability problem, in that they do not have the means in which to put money aside for emergency funds because cash flows are negative. There may be high volume unsecured finances that they are servicing every month, or simply put, like most South Africans, the cost of living is quite high,” Moonsamy said.

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In a statement, the Western Cape Minister of Agriculture, Economic Development and Tourism Dr Ivan Meyer, said financial education was a critical tool for helping consumers take control of their finances.

“Financial literacy plays a critical role in helping consumers make informed financial decisions. Understanding concepts such as budgeting, responsible borrowing and long-term saving empowers individuals to take control of their finances, build resilience against financial shocks, and secure a better future for themselves and their families,” Meyer said.

Research shows that many South Africans struggle to save regularly, leaving them exposed to emergencies such as medical costs, job losses and unexpected household expenses. Savings Month aims to raise awareness about the importance of building emergency funds, setting achievable financial goals and making saving a consistent part of everyday financial planning, the statement added.

Consumers are encouraged to create and follow a monthly budget, set realistic savings goals, build an emergency fund, avoid unnecessary debt and impulsive spending, and continuously improve their financial knowledge.

How to you reset your budget without giving up on your savings goals?