We are forever grateful to the remarkable women who brought us into this world, clothed and fed us, and shaped us into the people we are today. However, for many of us, feelings of love and gratitude are combined with worries about how we are going to support them financially into their retirement.
People need to take practical steps to secure thadeir own finances before they can realistically take on the financial responsibility for someone else – even if that someone is the woman who raised them.
We know from the 2017 Old Mutual Savings and Investment Monitor that one in four metro working South Africans is already supporting one or more parents. This trend is highest among black households and often linked to the obligation that has become commonly referred to as ‘black tax’. Having elderly dependents has far-reaching effects as it limits your capacity to uplift yourself.
What is even more startling is that when re-based to exclude those who have ‘no parents around to support’, the statistic jumps up to 70% of respondents who foresee that they will have to support older family members in the future.
So how should young South Africans who expect they will one day have to support one or both of their parents be preparing for this future financial obligation? The key, is to get your own financial future in check.
Think about it this way, you will only be able to continue to meet your mom’s financial needs if you have your own secure financial plan in place. Your financial plan needs to take your dreams and goals into account as well as your other financial obligations.
Without a long-term, sustainable plan in place you will erode your own wealth and ability to assist your loved ones financially. That’s why speaking to a financial advisor and drawing up a holistic financial plan is actually the best gift you could give your mom this Mothers’ Day.
The concept of ‘paying yourself first’ not only applies to your savings but also to ensure that you have the right money plans in place to ensure you are on track to achieve your financial goals.
Having a realistic plan in place – one that addresses your unique needs and responsibilities – will not only be key to creating a secure financial future for both yourself and your mom, but will also help to break the cycle of dependency in your community.
Lizl Budhram is the head of Advice at Old Mutual Personal Finance.