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VIEWPOINT: WHAT WEALTH?’ Finding a balance

Benjamin Franklin once said: ‘Money has never made man happy, nor will it. There is nothing in its nature to produce happiness. The more of it one has the more one wants.’

Will money make you happy? Research has shown that professionals tend to be income rich but balance sheet poor – and they generally require long hours to achieve this. A Princeton study found that emotional well-being did rise with income – but only up to $75 000 (about R1 million) a year.

Money doesn’t go far: we have to be the most consumptive consumer generation ever, fuelled by the rapid development of ‘goodies’ (requiring constant upgrades); ease of online access and free delivery; and easy access to credit. And we cannot escape blanket marketing, which is no longer restricted to radio or TV ads but flourishes online via social media. It’s just too tempting and so very easy.

Then, add a cost of living rising faster than many salaries and the worry of a rising interest rate cycle which means servicing one’s growing debt and feeding the lifestyle will become ever more challenging. That’s not the only concern: large-scale company downsizing at the moment means more ‘sandwich generation’ dependencies, more graduates supporting extended families, and more international competition for your job. And it makes for a tough prospect.


Mirinda Laurens CFP, a corporate financial wellness coach, offers more bleak evidence that we need to tighten our belts. Our (official) unemployment rate is a staggering 25% (5,23 million) according to Stats SA; the consumer debt-to-income ratio in Q2 2015 increased to 78,4%, according to the Consumer Credit Index Report; and total consumer credit amounted to R1,63 trillion according to the National Credit Regulator. In Q1 2015, South Africans added R108 billion in new credit and another R112 billion in Q2, with more than 11 million credit-active consumers described as being ‘over indebted’.

Can we balance having those ‘goodies’, with investing for our dreams, servicing our debt, and also being happy, all at once? One thing’s for sure, it’s unlikely to happen simply by chance.

Author: Mike Lledo CA(SA) is the CEO at Consolidated Financial Planning