The perception that wealth is the prerogative of the elite and not ordinary South Africans is a notion that financial services provider, Ithala SOC Limited, is seriously challenging.Ithala SOC Limited, a 100% owned entity of Ithala Development Finance Corporation, believes over-indebted consumers must engage in some serious introspection and exercise strict financial discipline if they are to comfortably make ends meet.

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.

As a financial services institution, Ithala SOC Limited regularly engages in initiatives to help promote financial literacy in communities and encourage a spirit of saving through its new financial literacy flagship programme called ‘MoneyTalks’. The establishment of the MoneyTalks programme arose from the need to start having conversations about money, which is a taboo topic, especially in the previously disadvantaged households. Ithala believes that redefining what wealth means for ordinary South Africans, and educating people and giving them the necessary tools to manage their money can help address the triple challenges of poverty, unemployment, and inequality.

“The wealth creation journey can start even before one becomes economically active. Equipping people with key financial literacy skills will enable them to make sound financial decisions that will kick start their wealth creation journey. Often what makes wealth unattainable to a lot of people is financial illiteracy which leads to bad consumption-driven decisions.” said Sandile Xolo, Ithala SOC Limited Marketing and Communication Manager.

To equip Ordinary South Africans with financial literacy skills, we have partnered with the Consumer Financial Education Foundation (CONFEF) and superhero characters Dudu & Sipho in the roll-out of the MoneyTalks programme at schools, tertiary institutions and in communities.

We want people to be comfortable to talk about money, and we have therefore simplified our messages and developed easy to follow guides that will help people master the money management and wealth creation principles. The premise for this is that if people can master the principles, they will be able to create wealth. One of the tools we use in the MoneyTalk programme is a 4 step easy to follow wealth creation journey or formula; 1. Get out of Debt2. Start saving3.

Start investing and4. Build multiple streams of income.  He said Ithala was committed to serving the ordinary people of South Africa to manage their money and create wealth, irrespective of their social or economic status, whether in their private capacity, in their family environment or in business.“As CONFEF, we are very passionate about consumer financial education. This is the reason we have partnered with Ithala in the MoneyTalks programme" said Octavia Hlatshwayo, CEO of CONFEF.

We have started rolling out the programme in schools and the learners are very excited about the program. The programme will accommodate all target groups from primary schools, high schools, higher learning institutions and as well as business entrepreneurs. A total number of 1398 people have received lessons on saving in various institutions. Said Octavia.A report compiled by Debt Rescue based on year-long research showed that only 23% of South Africans have money left at the end of the month.

The report revealed that most people battled because of debt repayments, with more than half of consumers having to use 75% of their salary to make debt repayments. The research also found that people between the ages of 31 and 45 had the most debt. This age group was also more inclined to have family members depending on them financially. While people with a lower income would resort to getting loans from loan sharks, middle and high-income earners spend a big portion of their money repaying credit agreements.

Consumers used 38.9% of their income to repay personal loans, which the survey found was the biggest debt. Personal loans also far outnumbered all other types of debt for all age groups. In 2015, National Treasury introduced tax-free savings accounts to be offered by banks, life insurance companies, collective investment scheme managers, Linked Investments Service Providers (LISPS) and authorized users to the public. Tax-free savings accounts are a way of encouraging more individuals to save and invest.“Investment is an important vehicle for wealth creation.

Hence, much needed guidance on financial planning coupled with a savings culture will yield positive returns for ordinary South Africans,” added Xolo. Ithala has a 60-year legacy of encouraging the people of KwaZulu-Natal to save as a means to accumulate personal wealth. A distribution network of 39 branches in KZN provides convenient transacting facilities. Ithala SOC Limited suite of offerings includes a range of key savings and investment products, transactional banking, retail, housing, insurance, and lending products.

For more information visit www.myithala.co.za, call 031 366 2500 or follow the conversation on twitter: @Myithala, Facebook: @Myithala #MoneyTalks #RedefiningWealth #Ingcebo