Personal Finance Financial Planning

The importance of financial planning for South African youthRory Brachner|Published 5 days ago4min

Discover how young South Africans can enhance their financial well-being alongside their focus on therapy and fitness, and learn essential strategies to build a secure financial future.

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More young South Africans are prioritising wellness through therapy and fitness, but they continue to overlook financial well-being, and it is costing them more than they realise.

Money stress spills into every part of life, from relationships to mental health, yet many young people build their early careers without building a financial plan

According to a Sanlam report, 57% of South Africans cite financial stress as the top factor affecting their mental health, with 18–24-year-olds the most vulnerable. Yet, despite South Africa’s high youth unemployment rate, there are 20.9 million working young people aged 15 to 34 who still face financial challenges due to limited financial literacy. The 1Life Youth Generational Wealth Survey found that while 80% believe they can build wealth once employed, only 30% have a monthly budget, and half don’t know how to secure their financial future.

The opportunity to build strong financial habits early is invaluable. Even modest savings in your 20s can have a powerful impact by your 50s. Good habits compound over time. Like a muscle, the earlier you start these habits, the stronger they become.

Many young people assume that financial planning means cutting back on their current lifestyle, says Brachner. Good advice isn’t about restrictive spending, and we often encourage our clients to travel and celebrate life's experiences, as this is important in your 20s. Rather, a good financial plan gives you the freedom to do more of what matters now, while still setting yourself up for the future.

There’s a common misconception that financial advice is only for the wealthy. Traditional advisor models typically focus on assets to invest, which excludes most young people who typically only have a salary to invest. But they still need guidance - not to manage wealth, but to build it. Just like they invest in therapy or fitness, they can invest in financial well-being.