At a recent financial dialogue hosted by Momentum, a prominent financial services company, experts gathered to discuss the growing need for personalised financial advice, especially in the context of rising living costs and economic pressure.

In a country marked by stark economic inequality, financial planning is about more than just investing, it's a matter of survival. Momentum brought together key stakeholders to explore how financial advice can better serve South Africans across different income groups. According to Professor Carel van Aardt, Director of Research at the Bureau of Market Research, the growing awareness of the need for financial guidance is primarily driven by survival concerns, rather than investment opportunities.

“Many people feel financially vulnerable and focus on building emergency savings and risk mitigation,” Van Aart explained. “For some, having money for funerals or managing overwhelming debt is a top priority.”

While South Africans are increasingly recognising the need for financial planning, few have formalized their approaches. Van Aardt pointed out that financial strategies vary significantly between income groups, with many individuals focusing on short-term survival instead of long-term saving. “Very few people have a written financial plan. Most people tend to manage their finances informally, relying on mental budgeting for daily survival,” he added.

The urgency for tailored financial advice has increased, particularly as more people retire without enough resources. Momentum’s Chief Executive Officer, Hannes van den Berg, underscored that changing health trends, such as rising rates of cancer and heart disease, make financial planning more crucial than ever.

Despite the clear need for financial advice, misconceptions still persist. Many South Africans continue to view financial advisors as salespeople or believe their services are unaffordable. “These misunderstandings must be addressed,” said Van den Berg, stressing the importance of structured financial guidance in securing a stable financial future.

--ChannelAfrica--