Individual savings behaviour in an emerging market context

Abstract

This paper investigates how individuals in emerging markets, specifically South Africa, approach their savings decision. The researcher attempts to identify those attributes most desirable to emerging market consumers, in so far as the allocation of their disposable income to saving is concerned. In the wake of one of the biggest financial crises to hit the modern world, there is going to be increased scrutiny into how financial institutions and countries capitalise their balance sheets. The manner in which financial advice is given to individuals will face similar scrutiny as such the subject matter requires even greater understanding. Human beings in some parts of the world are living increasingly longer. Longevity risk is the risk that people may live for longer than the average expected. This poses risks of uncertainty of the quantum of financial assets to build up in preparation for retirement. These are pertinent reasons for the need for a study of this nature. The research found that stereotypical understandings of the profile of a typical emerging market individual are being challenged. As such organisations looking to take advantage of business opportunities present in these markets need to be cognisant of this change in shaping their business strategies.