South Africans are changing the way they spend their money to cope with the rising cost of living and to ensure they have enough money to survive until the end of the month.

New data from the Old Mutual Savings and Investment Monitor survey (OMSIM) shows that South Africans have learned a hard lesson over the last two years, sparked by the Covid pandemic, and are being more cautious with their spending.

Rising inflation and the decision by the South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) to increase the repurchase rate (repo rate) by 75 basis points have put consumers under immense pressure. And economists have warned that further pain is on the way, meaning further belt-tightening will be required.

The OMSIM tracks shifts in financial attitudes and behaviour of the country’s working population. For the report, the financial services company interviewed 1,505 respondents of various ages, personal income ranges, and genders.

Following the damage brought on by Covid-19, almost 9 in 10 (86%) of working South Africans have changed how they manage their money.

“It is noteworthy that they continue to display optimism regarding their future personal financial prospects and show a healthy dose of financial resilience,” said Vuyokazi Mabude, head of knowledge & insights at Old Mutual.

Respondents reported changed positive financial behaviours: 39% have more than three months’ savings in place to act as a buffer in the event of retrenchment or job losses, up from 36% in 2021.

Old Mutual’s report found that respondents are increasingly turning to loyalty programmes and discount rewards to push their money further, while also switching to cheaper food brands, cellular packages and entertainment options to save.

There has also been a move to cut ‘luxuries’ like domestic workers and gym

“Overall, the 2022 OMSIM research has shown that South Africans have learned from some of the harsh lessons of the Covid-19 period.”

“The shock of losing or facing reduced income caused many to relook and re-evaluate their finances. Positive changes were made and have impacted the attitudes towards savings – something that will stand them in good stead while they face the new challenges presented by 2022,” said Mabude.

Consumer credit reporting company TransUnion pointed to a similar trend in its latest Consumer Pulse Study for the second quarter. The study looked at consumer behavioural trends and attitudes towards current and future householders’ budgets, spending and debt.

TransUnion reported that the average household budget has seen big cuts to discretionary spending, like dining out, travel, etc, while also a reduction of subscriptions and digital services.

TransUnion’s Consumer Pulse survey of 1,004 adults was conducted between May and June 2022 by TransUnion in partnership with third-party research provider, Dynata.