“Money isn’t everything, but everything needs money.”
South Africa is currently experiencing exorbitant inflation levels. While we cannot change this, we can become wiser with our money. To learn more about inflation, what it is and what it means for you, visit our Money Moves with Debt Rescue YouTube Channel here.
With an increase in inflation, consumers naturally have less spending power. With a decline in spending power, it becomes much more difficult to navigate day to day costs. Those who can keep their heads above water without needing assistance, will have to put spending blinkers on. Every cent needs to be turned over ten times before letting it go. Luxuries need to be cut in half. Impulsive shopping habits must come to an immediate end. There is absolutely no room for spending mistakes now.
What is Inflation and Why Should You Care?
In layman’s terms, inflation is designed to reduce the purchasing power of consumers. This is due to the increase in goods and services of the country’s economy. When inflation is high, we tend to spend less. In theory, this will help bring the cost of products and goods down.
Inflation is curbed through increasing the interest rate, however that brings about a whole new set of problems for the consumer. Watch our video on interest rates here.
Less purchasing power means that we can no longer buy last months food for the same price anymore. The Household Food Basket calculated by Pietermaritzburg Economic Justice and Dignity (PMBEJD) is currently sitting at R4688,81 as of June 2022. The household food basket increased by R72,89 (1.7%) in one month.
The Major Price Increases
The household food basket may have increased by 1.7%, but some staple and well-loved food items have increased by 5% and above. These are:
- Cooking Oil has seen a 13% increase. 5L of cooking oil now costs R228,94.
- Curry Powder has increased by 5% since May.
- Green peppers are now 10% more expensive than last month.
- Apricot jam, Cremora and brown bread has seen a 5% increase.
Those food items with an increase below 5% are:
- Cabbage seeing a 3% increase.
- Margarine is now 4% more expensive than in May.
- Salt and white bread both increased by 4%.
- Maize meal which is bought by many low-income households is now R268,88 for a 30kg bag.
- Even chicken feet are 3% more expensive.
Possible Solutions for Struggling Consumers
Turn your cents over a thousand-fold. Some households will not be able to do this and will have to readjust their budget. If you do not have a budget by now, it is imperative that you make one. Do not deviate from it and plan everything down to every loaf of bread that you buy.
Do not buy food on debt. Do not take out a payday loan or a loan which allows you to have access to your salary throughout the month. This will only drive you further into extreme financial trouble.
Many consumers are finding the cost of debt and living expenses difficult to manage. WhatsApp one of our consultants to discuss your options for financial assistance. At the 7th South African Customs Union Meeting, President Cyril Ramaphosa mentioned that something needs to be done about the rising costs and perhaps allowing various economies to work together to become food secure and self-reliant. For now, we need to manage the best way that we can. Do your homework before spending your money and ensure that you keep your head above water and use the help that is available.