How you can retire early

THIS column is not for everyone. The majority of South Africans exist hand to mouth, with far too many households living below the breadline.

- MARTIN HESSE

“All this talk of saving,” they will say, “when we don’t even earn enough to feed our families.” Let's consider their situation for a moment.

The Pietermaritzburg Economic Justice & Dignity Group publishes a monthly Household Affordability Index, which calculates the cost of a basic basket of groceries in different parts of the country and compares it with wages.

For October, the average basket of essential foods for a household of four costs R5 441. A worker earning the minimum wage, working 23 days in the month at just R28.79 per hour, brings in R5 297. Add two Child Support Grants of R560 each and a Social Relief of Distress Grant of R370, and the total income for a household with a single minimum-wage earner comes to R6 787.

Spending R5 441 on food would leave R1 490 for everything else, including accommodation, clothing, nonfood groceries, and transportation. They therefore spend less on food, with the result that they don't get the nutrition they need. Saving is out of the question.

If you are in the position of earning a decent salary that covers your basic living expenses with some to spare, you belong to a privileged minority of South Africans. And if you are young with most of your working life still ahead of you, the saving ideas outlined below might appeal to you..

The Fire movement