How to spend without sabotaging your savings goals

BUSINESS NEWS - With household budgets under strain from rising fuel, food, and transport costs, South Africans are rethinking how they spend.

As inflation bites, simply cutting costs becomes difficult, and increasingly, consumers are looking at new ways to better manage their cash flow.

“With every rand working harder, we are seeing a shift toward more intentional spending. Consumers are looking to budget their discretionary purchases responsibly where possible, instead of turning to credit for instant gratification,” says Dean Hyde, COO at payments platform, PayJustNow, which offers Buy Now, Pay Later (BNPL) and retail credit payment products.

“Our average customer earns around R21,000 per month and splits their payments over several instalments on everything from fashion and appliances to services like X-rays and optometry,” says Hyde.

Most checkout carts range from R1,500 to R2,500 depending on income level.

As more consumers focus on paying off debt and saving, splitting their payments has become a useful budgeting tool in managing bigger ticket expenses.

“We’re seeing our base of more than 3 million shoppers plan their spend, with 42% browsing our retailer deals two to five times a month, often searching for essentials like fridges, tyres and smartphones,” says Hyde.

The data implies that consumers are increasingly turning to alternative options like interest-free BNPL, especially young South Africans with so called “thin files” who value convenience, or who are unable to secure traditional credit.

“Splitting your payments to better manage your cash flow and ease the pressure of meeting your financial obligations must be done with careful consideration,” says Hyde.

How to split your bigger-ticket purchases responsibly

Stick to one provider - Using multiple BNPL platforms or even multiple retail credit providers is like juggling several credit cards - it can lead to overextension.

Don't use any form of credit for consumables – Splitting a purchase of consumables like groceries, takeaways or fuel, is effectively spreading the cost of something you use today over three, six or twelve months. That only adds pressure, instead of reducing it.

Consider the ‘what,’ ‘why’ and ‘how’ – Before using credit, ask if the item is something you need immediately. If yes, check whether the monthly repayments over 3, 6 or 12 months –

including any interest – fit your budget. For example, a smart pair of shoes for a job interview might be better suited to a short-term, interest-free BNPL plan. But for something like a laptop, which helps you earn an income, a longer-term plan with interest could be justified – as long as the monthly cost remains affordable.

Choose a responsive provider - Select a provider who is easy to engage with and has an active customer service department that’s willing to help if you ever need to change your instalment date or have an enquiry.

Always read the fine print – Repayment options, interest rates, and fees can vary between alternative payment providers. Choose a provider that is transparent about instalment dates, interest charges, and all applicable fees, and make sure these align with your salary cycle and budget.

“As National Savings Month reminds us, staying financially resilient is not just about cutting back. It is also about using the right tools at the right time. When used strategically, alternative payment options like BNPL and credit products enable South Africans to purchase discretionary items, stay on track with their savings goals and still manage their everyday expenses. After all, in this environment, it is not just about what you buy but about how, when, and why you choose to pay.”

Dean Hyde, COO at PayJustNow