A lifestyle change should not be frightening

By Bokang Moeko

Last week Tuesday, April 12, oil rose above $43 a barrel to its highest level so far in 2016, supported by hopes that a meeting, of April 17, of oil producers would agree steps to tackle a supply glut and by a weak US dollar and further signs of strong demand in China.

Remember, the jump in the cost of electricity, in South Africa, is to come into effect this month. This increase of oil and electricity is going to increase prices further. The prices are already expected to increase in May – and this does not come as a shock at all.

Let us carefully look at this, according to the latest FNB-BER study, in the first quarter, the South African consumer confidence index recovered from a 14-year low, but still remained in negative territory.

FNB chief economist SizweNxedlana said the slight recovery was helped by the end of power cuts and a fall in fuel prices between October 2015 and March 2016, among other things.

“Given that the heydays of easy access to unsecured credit, low interest rates and strong growth in public sector employment are now behind us, we expect the growth in real consumer spending to slow further during 2016,” Nxedlana said.

Let me clarify something here, consumer spending fuels GDP which is a measurement of the health of the country’s economy. If consumers spend less (the current increased cost of borrowing, stagnating and receding wages and increased prices makes this a fact) the economy stalls possibly leading to a longer-term recession.

Could this be the case for South Africa?  Repeat, could this be the case for Lesotho?

We have, literally, cut everything we don’t really need by now I assume.

But times are heartbreakingly tough. This really is a crocodile infested river and you cannot expect to come out unscathed. I now understand why the rate of suicide attempts accelerated at the start of April in many aboriginal communities in Canada. And why some life coaches are recommending people to stop watching the news and stop reading business columns. But how will we know what to do to minimise pain if we do all that?

Okay, by now, we have our door sized gardens, are wearing all clothes in our wardrobes, have lost some car dependency, and opted to driving cars that are mainstream.

While on that note, what do you think of the new Toyota Hilux and the new Ford Ranger? A farm girl in me knows Lesotho is a bakkie country. The top of the range Toyota Hilux 2.8 GD-6 4×4 AT Raider comes in at R547 900 compared to the top of the range Ford Ranger 3.2TDCI 4×4 AT Wildtrak at R597 900. This is worth mentioning because I know there are people, a few number I assume, that can afford these cars. And these are the very people we rely on to increase consumer spending now.

But my advice is, pay cash. The cost of borrowing is high now and might continue to increase. According to Reuters, South Africa’s retail sales grew above expectations in February, data from the statistics agency showed on Wednesday, April 13, suggesting the central bank might have scope to hike interest rates further at its next policy meeting.

So, you don’t want to find yourself in a tight situation whereby you have to pay way more than you bargained for and end up missing your payments.

But if you can have a high amount of debt but also have a high amount of income that allows you to easily afford the payments, then borrow. Your debt won’t drag down the economy, it will help it grow.

But for those who depend on a salary that is barely helping make ends meet by now, they should avoid borrowing at all costs and continue cutting down the expenses. Here is what to cut:

• Parties — and night outs with your boys or girls. There is a little boy or girl inside of you who wants to live a bit. Allow him/her to. In the privacy of your own home, play your favourite song and dance like never before in your pyjamas– perfection is overrated, so for once you can be yourself.
• Install a solar geyser and save up to 40% on your monthly electricity bill.
• When everything becomes really hectic, you have an option of moving into a smaller apartment or move back home, if you are single,– there is no shame in that, the A listcelebrities in South Africa, Kelly Khumalo and DineoRanaka, have done it.
• Should the clothes in your wardrobe befew, consider buying second-hand clothes — Britney Spears does it so it’s cool — or go through your mother’s wardrobes ladies — vintage clothes will always be elegant and fashionable.
• Married couples, romance is not expensive. Make an effort of cooking your husband his favourite meal once or twice a week. “Honey, you look good”, is a million dollar compliment. Give him that million dollarevery day.