South Africa:Financial Confidence Index remains stable in 2024

In 2024, the overall Financial Confidence Index (FCI) remains stable, with slight improvements noted in Financial Resilience (FR) and Financial Wellbeing (FW) compared to 2023, says Sanlam, which is South Africa's largest insurer.

The ”2024 Sanlam Financial Confidence Index” report also indicates the following:

The report shows that:

• One in three consumers (32%) have a very low or low FCI.

• Just under half (47%) of consumers have a below-average or lower FCI.

• A quarter of consumers (27%) have a high or very high FCI.

• In 2024, Gen Z (66) and Millennials (63) had the highest Financial Self-Determination (FSD), reflecting a stronger alignment between their financial needs and aspirations.

• Individuals earning under ZAR8,000 a month had a significantly reduced FSD (48) compared to those earning +ZAR20,000 (69).

• In 2024, Gen Z (60) and Millennials (54) had the highest FR as well. Consumers employed full-time had higher FR (58), along with those earning +ZAR20 000 a month (63). Many are upskilling to increase income, showing a strong entrepreneurial and resilient mindset. Gen Z still benefits from familial support, while Millennials are stronger in financial management.

• 2024 showed that Baby Boomers have lower FSD and FR indices due to undefined goals and goal-tracking systems, and a lack of insurance. However, they have higher FW (33), reflecting higher security and confidence in their financial circumstances. Individuals earning under ZAR8,000 a month have a lower FW (24), compared to those earning +ZAR40,000pm (48), due to anxiety over their future earning potential and investments.

Willingness to discuss finances

The report reads, “It’s positive to see some improvement in people’s overall financial resilience and wellbeing, however, nearly half the population still has a below-average or lower FCI. There’s overwhelming evidence that people are eager to upskill themselves. Knowledge sharing through supportive, open conversations about finances is invaluable. Positively, our research reveals an increase in willingness to engage in ‘money talk’, with 33% of people not feeling scared to talk about finances – up from 31% in 2023. Sanlam’s The Dirtiest Word campaign aims to amplify this further, bringing these critical conversations into every household.”

Link between income and FCI

About 54% of the sample earn less than ZAR8,000 per month, with 15% in the next range earning less than ZAR15,000 per month Findings have shown a link between earnings and FCI. Those earning lower may mostly be stuck in survival behaviours, with limited or no awareness of financial learning and how to determine personal goals. Considering that they are in survival mode, chances are high they may be using products that also create a vicious cycle of survival, like high interest debt, which they might not have the mindset or skillset to ‘break’.

Sanlam worked with market research company African Response to survey 1,610 South Africans, representative of the population, aged 20 to 70 years, with a personal income from ZAR1,000 ($56) to over ZAR40,000 per month. Most participants were from metro and urban areas, across all provinces.