What is wrong with the state of savings?

Before I answer the question, bear with me for a moment while I explain something first, this being my first post and all.
For some time I have felt compelled to post and share on the issue of money, wealth and financial freedom. I tried to figure out where to start, as this is a big topic and many things have been written and said about it.

Well this Fin24 Infographic: State of Savings in SA [edit: this page is no longer available – but the image can still be seen here] came to my attention and on the face of it, a clean and factual effort, except it contains a not so obvious error.

Could you spot it?

If you read Simon Sinek’s book “Start with why” then you’ll know the creator of the infographic confused “why” with “what”.  Why is about emotion or common belief or shared vision.  The infographic asks the question “Why save?” and instead of answering the question of “why” goes on to give 4 ideas for what to save for (mislabeled as “why”) and several suggestions of “how” to save.

What is wrong with the state of savings?

The obvious answer is: we don’t save!
The better question is: why don’t we save?

Herein lies the tragedy and why I could no longer delay starting this process of writing about it.  The reasons we don’t have a savings culture is beyond the scope of this post as it is a complex topic.  As such I cannot do the better question justice, but maybe we can address why we should save and maybe somebody will create a better infographic.

Why save for education:  Because with education comes freedom of choice and a way to break from the negative cycles of poverty or debt, a better life.  If you believe in the value of education and its importance, then figuring out how to save and put together an education fund (the what) for you children is easy.

Why save for an emergency:  “Dig the well before you need the water”, is an old saying and no different from having a spare tyre in your boot.  If you believe in paying your own way and not being reliant on others, then figuring out how to save and put together an in case of emergency fund (the what) for a bad day is easy.

Why save for a holiday:  Nobody on their death bed regrets not spending more time at the office.  If you believe that memories with family is worth more than most things in life and that a shared adventure on holiday can create such memories, then figuring out how to save and put together a holiday fund (the what) for the family is easy.

Why save for a car or house:  Asset accumulation is by far the most important financial skill one can learn.  If you believe in financial freedom and a life of being debt free, then figuring out how to save and own assets debt free (the what) is easy.

Understanding the “Why” will provide the emotional motivation to create the habits by applying the “How” and achieving the “What”.  Without “Why” you only have logic and for some reason logic is not enough.