Struggling South Africans to cut back on DStv, take-aways, and drinking after COVID-19

South Africans plan to cut spending across a number of areas after the COVID-19 pandemic has run its course, according to the 2020 Old Mutual Savings and Investment Monitor report.

The report surveyed South Africans with a minimum personal income of R5,000 per month, asking them about their projected spending and saving trends following the advent of the COVID-19 pandemic.

Its findings portrayed a significant spike in financial anxiety among South Africans, with financial satisfaction levels hitting an all-time low.

“Not only are absolute income levels under pressure as many take salary cuts, but demands on share of wallet are increasing as never before,” the report said.

“A third of consumers find that they are having to support more people financially than they did before the pandemic.”

“Couple that with a constant fear of retrenchment or loss of income, and no wonder stress levels have skyrocketed,” it added.

Savings have been further eroded, and South Africans are doing their best to adapt to the financial pressure through online stokvels, relief measures, loyalty rewards, and interpersonal loans.

Cutting spending across the board

The researchers asked South Africans how they expect their spending across a variety of areas to change after the lockdown restrictions are ended.

In response, South Africans said they planned to cut expenses to various degrees across the board, with the exception of medical aid and, to a lesser extent, accommodation.

68% of South Africans said they would cut back on their entertainment expenses, including eating at restaurants.

62% said they would spend less on entertaining at home, and 60% said they would cut back on holiday and travel costs following the pandemic.

Other major planned spending cuts included alcohol (56%), cigarettes (48%), and the employment of domestic workers (40%).

MultiChoice’s DStv satellite broadcasting service was also included among the areas where customers planned to save money, with 25% of DStv subscribers planning to cut back on their subscription after the lockdown.

“It is notable that younger consumers are more reluctant to spend less on entertainment, take-aways, eating out and travel, whilst 50+ year-olds are less likely to cut armed response, insurance, assistance to children and medical aid,” the report stated.

Below are the re-based results, which look at the results for each category where respondents were already spending every month.

Category Will cut back Will spend more Unchanged
Eating Out/Entertainment Expenses 68% 9% 23%
Take-aways 64% 10% 25%
Having Friends Round/Entertaining at Home 62% 12% 26%
Holiday and Travel 60% 12% 28%
Alcoholic Beverages 56% 10% 35%
E-Hailing Services 49% 15% 37%
Hair/Beauty 49% 8% 43%
Cigarettes 48% 21% 31%
Shoes and Clothing 48% 11% 41%
Home Improvement/Maintenance 47% 15% 38%
Online Shopping for Shoes and Clothing 42% 21% 37%
Nanny/childminder at home 42% 14% 44%
Online Shopping for Electronics and Appliances 41% 21% 39%
Domestic Worker/Gardener 40% 10% 51%
Pre-School/after care expenses 35% 15% 49%
Online Shopping for Groceries 32% 31% 38%
DIY 31% 27% 42%
Other Online TV/Movie 30% 15% 55%
Cell phone/Airtime/Data costs 30% 26% 44%
Transport/Getting to Work 28% 20% 52%
Armed Response/Alarms 27% 11% 61%
Assistance/Payments to Children/Dependents 26% 20% 54%
Food and Groceries 25% 34% 41%
DStv/M-Net Subscription 25% 9% 66%
Children’s Education 22% 19% 60%
Car and/or Household Insurance 20% 8% 73%
Accommodation 18% 12% 70%
Medical Aid 14% 14% 72%

Now read: Good news for Discovery Health members – You will get a bed if you have COVID-19

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Struggling South Africans to cut back on DStv, take-aways, and drinking after COVID-19