The big squeeze
“I have done quite well in my working life, and it’s been a shock to find myself struggling. I went into retail when I was 20; now I’m a store manager for a big chain. I get a good salary and I’m grateful for that, but increases don’t keep up with inflation.
“I have changed jobs a few times over the years to try to improve my income, but now I wonder if it might have been better to stay with one company.
“The worst thing is that I didn’t always transfer my pension when I changed jobs; I thought it made sense to use the money on things we really needed. Now I know it never makes sense to use pension money before you retire - it’s probably all you’re ever going to have.
“When I got divorced at the age of 40, the children were young: my daughter was 11 and my son was 9. I had enough money to buy a small house and the children’s father gave me financial support until they were 18.
“With that and my career I felt quite sure of myself. My children would be earning in 10 or 12 years, and my mother was very independent. I thought the worst that could happen in my old age was that I would have an empty nest.
“But when you’re used to caring for others, it’s not that simple. Their struggles are always your struggles. Deep down, I still think that’s how it should be in families, but I’ve had to learn that you must make sure you’re okay first. Like they tell you on planes: put on your own oxygen mask before you look after anyone else. My children won’t thank me if they have to support me when they are in their forties and fifties.
“My mother is 79 now, and she has no medical aid and has to penny-pinch to get by. She likes living alone, but she can’t afford domestic help and any exceptional expense causes panic, whether it’s a new kettle or something bigger, like a plumbing problem. Going out always means spending money; she and her friends don’t feel safe going for walks or sitting in parks, petrol is expensive and they need cellphones, which chew up data and are a target for thieves.
“It’s very sad and unfair and I’ve always been happy to pay for the extras - necessities, as well as occasional treats, like her favourite foods, and movie tickets, which she can’t afford.
“At the same time, my children are struggling and their lives are stressful. The job market is bad, transport is expensive and their money doesn’t go far, especially when they are expected to go to bars and restaurants with their friends and pay for Ubers. Being millennials, they have high expectations you wouldn’t believe what it costs to go to a wedding these days. I don’t know how much debt they have, but I wouldn’t be surprised if it was a lot.
“They both have jobs, thank goodness, but my 25-year-old daughter is still living at home and I hate taking any money from her - she needs to save whatever she can. My son lives with friends, but he never has any money to spare. Because I was subsidising his sister, I felt I owed him and got into the habit of taking him shopping, giving him money for petrol, buying him food and that sort of thing. I enjoyed doing it.
“When we were out together I would always pay, and they stopped offering. That was the only thing that worried me about the situation: did they appreciate that I didn’t actually have money to spare?
“So when a friend asked me why I wasn’t charging my daughter rent, it hit a nerve. I admitted I couldn’t pay into my retirement annuity and had cancelled my household insurance. The worst thing was giving up DStv; I love news and sport. I was also worried about day-to-day medical expenses, especially at this time of year, when the savings portion of my package runs out.
“And it was making me a bit depressed at times, honestly. I couldn’t see any light at the end of the tunnel. I will retire at 65 - only 11 years away. My house will be paid off, but after the costs of selling, buying and moving, I probably wouldn’t be better off trying to downsize.
“So, with encouragement and help from my friends, I worked out an agenda, took a deep, deep breath and talked to my mother, my children and other family members.
“The result is that my mother has moved in with me and the rent she is saving covers her costs and gives her extra money for emergencies. It was hard for her to give up living alone, but she knows we are all making sacrifices.
“My daughter was shocked at first but is going to contribute to the bills and food and has taken on paying for the wi-fi. I tell myself she is still paying a lot less than she would do in her own place.
“My son was the easy one he said he never understood why I insisted on paying for everything! I’m not sure how realistic he is about money, so it was good to talk about credit, debt and saving.
“My brother in Nelspruit has agreed to share responsibility for my mother and has already picked up the bill for a few things. In future he may need to make a more formal contribution.
“And I have accepted that I won’t be retiring when I’m 65; I’ll be working as long as I can. Luckily, retail is something you can do for as long as you are reasonably fit and I am ready for it when the time comes.
“For now, I am just glad I’m putting money away in my retirement annuity again. And that I talked to my family. It was a relief and hopefully it has made them examine their own spending, as well as mine.”
The sandwich generation: A growing phenomenon
More than a quarter (27%) of the South African population is supporting children, parents and other family members, according to the 2018 Old Mutual Savings and Investment Monitor. That is up 4% since 2010.
Longevity is an important factor in this trend: at the start of the 20th century, about one in 20 people in their 60s had a living parent, according to the research. Today, nearly 50% of the over-60s have a living parent.
Another factor is poor economic growth. In 1990, fewer than one-third of young adults aged between 18 and 24 were living with their parents. By 2010, that proportion had increased to more than two-thirds (69%), and almost half (45%) of 25-to-34-year-olds were living with their parents.
The Old Mutual report indicates that this group urgently needs to be more aware and more realistic.
Even if they are not voiced, the financial expectations of the older and younger generations can put enormous pressure on the earner in the middle, says Lizl Budhram, the head of advice at Old Mutual Personal Finance. She suggests open communication about their needs and their wants, followed by a discussion about what you can and can’t afford to do to help them.
“It’s very important to remain realistic about what is feasible for your own monthly budget, and what isn’t - and then scale accordingly,” she says.