Briefing Document: Nedbank brings you Consumer Financial Education DA Date: Monday 19th 0f April 2021 TE Time: 16:05 & Presenter : Tornado TI Guest : Mr Desmond Chauke ME Programme : Goroga O bolokegile Via Call in to Radio FO RM AT CO NT The South African banking sector is aiming to make basic banking services accessible to everyone. Despite EX this, there are still many people who are unbanked. We are offering this financial literacy & education T platform to develop people’s financial literacy skills and by encouraging them to change their money habits, improve their financial well-being. So today we take a deeper look at the importance of SAVING. • Please introduce yourself to us. (Name & Surname, Occupation/Job Description). • Please give us a brief overview of your business institution? Nedbank is one of the leading financial institution in SA, we are the money experts who do good and help people to see money differently, as a Green bank, we care about communities 1 PO SSI BLE QU EST IO NS Our Topic today is “the importance of SAVING”. We want to look at the importance of SAVING and how during this very challenging time of COVID19 we can focus on how to better manage money, to stick to your plan and stretch the money you have especially during this time. Q1: Please define the word SAVING (In a Financial perspective) Saving is putting money away to be used in the future for a particular goal or purpose, more especially in rainy days when needed most. Q2: Please explain why SAVING is necessary. 2 One of the major problems identified in the growing over indebtedness of South African consumers, is the lack of savings, and the truth is that savings are necessary to help you out in case of emergency or to secure the future. Q3: What are the benefits of SAVING? a) b) c) d) e) f) Savings will help you avoid unwanted debt (Buying on credit) Keeps you well prepared for unexpected expenditures (Safety cushion) Savings can help you in case of emergencies (home, car, medical) Children’s future (Education) Prepares you for your retirement (Top up for grant or pension/provident fund) Helps you achieve your short- and long-term goals Q4: What are the steps you need to take to achieve your SAVINGS goal? - Achieving your savings goals requires commitment - Need to change mindset and attitude towards money - It is recommended that you save at least 10% of your income if you can - Most people only save between 0% and 8% in truth you need 20% to be comfortable during retirement - Generally, you need to have three month’s salary always set aside or saved to guard against unforeseen circumstances Q5: What must you prioritise between saving/investing or paying off debt? - It is better to prioritise paying off debt first before you start saving Because the interest charged on debt usually accumulates faster than the interest earned in saving Q6: What is the difference between Saving and Investment? - Saving is for a short-term goal Your money is usually safe Money is easily accessible However, the interests are low Investment is for a long-term goal and for wealth building The risk of losing your money is higher Access to the money has restrictions But yield greater returns than saving Q7: Over and above a normal savings account, where else can you save or invest your money? 1. Fixed and notice deposit accounts 2. Stokvel and club accounts 3. Unit trust A Unit Trust pools money and invests in shares, bonds, money market instruments and other investments. The pool is then divided into equal portions called units. Each unit has a price or Net Asset Value (NAV) based on the value of all the assets held in the fund 4. Endowment policies An endowment policy is a life insurance contract designed to pay a lump sum after a specific term (on its 'maturity') or on death. 5. Retirement annuities Your retirement annuity contributions reduce your taxable income up to certain limits: part of your contributions come from tax savings, which means that the South African Revenue Service (SARS) is actually paying a part of your retirement savings. Q8: What are the characteristics you need to consider when choosing a saving or investment account? 3 1. 2. 3. 4. 5. Ease of access to your money Convenience and ease of use of the account Account opening requirements Safety of your capital Interest earned on your savings Q9: Should anyone have any general enquiries about maintaining financial health or Consumer financial literacy and education programme which Nedbank rolls-out, please provide us with the contact person and details. - You can get hold of me on: provide your work number and email address Q10: Do you have any other information to share with us? - Saving or investing, just like budgeting, demands a lot of discipline and commitment That’s the only way you can reap full rewards For more information on Consumer Financial Education and Nedbank’s contribution during this time of COVID-19 please visit: together.nedbank.co.za/ or nedbank.co.za Consumer Financial Education is all about focusing on the ability to transfer knowledge and Skills to consumers and potential consumers for individual well-being and the public good. The programme is aimed at empowering consumers with knowledge to enable them to make better and more informed decisions about their finances, lifestyles and small business ventures. Through our programme we want to influence and drive a changed behaviour towards money and help individuals achieve their financial goals Today ‘s two Questions for our Competition is : 1. What has been your personal Savings Journey and has it challenged you in anyway? ( Tell your story) 2. Based on the understating Savings session, how will you make changes in your savings journey? (What was learned?) Please send your answers to our WhatsApp number 072 390 0474 The three lucky winners will be announced on Monday the 3rd of May during our last interviews show. 4 5
