Despite a slight improvement in finances experienced at the end of 2021, consumers in South Africa are still in an austere mindset and plan to cut discretionary spending over the next few months to shield themselves from the ongoing pressures of the Covid-19 pandemic.
Despite the improvement, unemployment levels remain a major barrier to financial freedom. One in three surveyed consumers said someone in their household had lost their jobs, while a similar number said someone in their household had their salary reduced. To combat the financial pressures, spending habits and shifts in household budgets took place across all households, mainly focused on discretionary spending. This category of spending typically involves non-essential items, covering things like eating out, entertainment, and travel.
These budget trends are largely expected to continue in the first quarter of 2022, with survey respondents pointing to a continued reduction in discretionary spending through to March 2022 . “While we’re seeing a slight improvement in the number of people financially negatively impacted by Covid-19, the study highlights the fact that many South Africans remain under pressure,” TransUnion said.
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