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Old Mutual launches debt education tool

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Old Mutual has launched an online, interactive version of its successful On the Money financial education programme, aimed at helping educate South Africans on debt reduction and wealth creation.John Manyike, head of financial education at Old Mutual, says, “This online initiative is in direct response to South Africa’s poor savings culture and high levels of debt. The user-friendly online module is especially valuable for employers whose staff have little or no financial literacy. Communities of burial societies, stokvels, religious groups and sports clubs, in particular, will find this tool empowering as the design and content encourage members to create financial security and freedom.”

Mr Manyike explains that Old Mutual is committed to helping reduce the high levels of short-term debt in South Africa and contribute towards creating a debt free society.

The latest 2014 Old Mutual Savings and Investment Monitor is an indication of the low savings levels in South Africa. The results illustrate that 80% of respondents want to learn how to save, yet 30% of these respondents have not seen a financial adviser and as many as 30% do not practise budget management.

The SA Reserve Bank’s 2014 report showed that households remain vulnerable with about 80 cents of every rand earned by breadwinners being spent on repaying debt.

“Some employers have also noted an alarming trend of employees who resign from their jobs to gain access to pension funds to pay off their debt, thereby reducing or removing their retire funds.

“The ‘On the Money’ tool is a user-friendly interface which offers practical guidelines for debt reduction and financial management. The content is based on the habits of South Africa’s Big Five – as shown on our banknotes – to demonstrate simple ways of improving financial health. The unique characteristics of the Lion, Leopard, Elephant, Rhino and Buffalo are applied to the principles of saving, budgeting, debt management, wealth creation and protection to make responsible money management easy to understand,” says Manyike.

For example, the behaviour of the Lion is to eat first, ahead of the pack. In the world of financial planning, this habit then demonstrates how to manage your salary by paying yourself first and saving before spending.

In the new version of the programme, the content has also been revised to include various other relevant issues that people are dealing with every day.

“The success of our financial education programme is based on practical examples that our users can relate to. We find it very encouraging that many employers have told us that there is a drop in the number of garnishee orders served on staff members who use ‘On the Money’.”

“Offering financial education to employees in the broader market is not about compliance; it’s about helping people do great things with their money,” concludes Manyike.

Since the launch of On the Money in 2005, the program has helped more than 400 000 people through face to face workshops and has reached over 15-million people through diverse media platforms. On the Money is available in the 11 official languages and is accessible across neighbouring African states.