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Even secretly dream that he may be in a position to improve your old age and ‘pay you back’ for the sacrifices you made for him? Unfortunately a new ‘Life Surprises’ survey from Sanlam may just burst your bubble. More than 40% of South Africans over 50 are unexpectedly supporting a family member – with children and grandchildren being the largest supported groups, followed by extended family members and parents.

The study – which polled 600 South Africans aged 50 and up to assess how significantly life surprises had impacted their lives – found that more than half of black people and a third of white people are unexpectedly supporting a loved one. It also found that males were significantly less likely to support grandchildren (38.8% versus 47.9%) and parents (7.8% vs 16.4%) than their female counterparts but they are significantly more likely to support their spouse (21.4% vs. 3.6%). When asked what the one cost was that they never planned for but is currently part of their regular expenses, 18.9% of respondents cited family support and providing for children or grandchildren.

“These are worrying findings,” says Karin Muller, head of Growth Market Solutions at Sanlam, “especially in view of the fact that most South Africans are already struggling to support themselves through retirement. Many South Africans expect to support others – children, elderly parents etc – but the fact that these findings are for ‘unexpected’ instances of support, is also very concerning. To avoid this having a serious impact on our financial and emotional health, it is well worth South Africans including the possibility of supporting family members into their financial and life planning.”

Muller says that tackling this potential issue head-on is the advisable route to go. It starts, in her view, by having those conversations many people feel uncomfortable having. “Talking about money, and sharing personal details about finances, is not a conversation which happens easily in families. It may be especially uncomfortable to ask an elderly parent to reveal details about how prepared they are for their later years. But honesty is the best policy. Transparency will go along way towards helping all parties get as financially organised as early as possible.”

“With children, you need to assess whether they have undertaken any financial planning and whether they have any risk cover in place should they become unable to work through illness, disability or retrenchment.”

Muller said that after getting all the facts are out in the open it is advisable to talk to a financial planner, both about your financial situation should you have to support a loved one and about the financial situation of your family. “This can help you make provision in your own plans should it seem inevitable that you will ‘inherit’ the financial needs of others. And, if it is not too late, it can help your loved ones become more organised so that they can remain independent for longer.”

Clinical psychologist Nondu Mphambo says the emotional toll on family relationships is also a consideration. “Unexpectedly supporting a loved one can lead to bitterness and resentment on the part of the ‘supporter’ and humiliation and feelings of failure on the part of the ‘supported’. For instance, parents who were looking forward to the day when they were financially free to enjoy their later years and the fruits their labour may find themselves resenting their children or grandchildren should they remain dependents.”

She agrees with Muller’s view about being as open and transparent about financial situations as possible. “This can help mitigate the emotional impact, if handled with respect and sensitivity.”

BOX - summary of key findings

  • 78.5% of people claim to have had unexpected life events (good or bad) in either their own lives or that of a member of their family.
  • Just less than a third of the sample (28.2%) expect to outlive their partners.
  • Of those who expect to outlive their partner, the majority (35.0%) are uncertain about how many years longer they will live, but just over a fifth (21.4%) expect to outlive them by between five and 10 years and 29.7% say they expect to live for more than 10 years after their partner dies.
  • Over half expect to live well into their 80s but only 1.3% of believe they will live to be over 120.
  • Most expect to die of old age (46%) or illness (13.8%).
  • Half the sample (49.5%) reported a death in the family as being the event that has had the biggest emotional impact on them.
  • 97.2% of those that lost savings or pension savings rated this event as having a devastating or high financial impact, whereas 93.7 % of people that faced the closure of their own business rated the financial impact as being devastating or high. 89.2% of people that lost their income or were retrenched rated this as having a devastating or high financial impact.
  • People find themselves largely unprepared for the financial impact of these events.
  • 40.5% currently support a family member that they were not expecting to support. Grandchildren (44%), children (43.6%), extended family members (20.2%), parents (12.8%) and spouses (11.1%) are cited most as having to be unexpectedly supported.
  • Respondents have many financial regrets - 74.3% of the people surveyed would change something in their financial preparation and 82.3% wished that they had done more to be better financially prepared for life.
  • Things that they would change: to save more of their earnings (54%), start saving for retirement earlier (47.5%), provide for unexpected life events (43.7%), spend less (42.6%) and get advice from a financial planner (14.3%).
  • Over a third of the sample (31.7%) got their financial advice from a financial planner, but 28.5% did their own research and planning, and 23.2% got advice from their parents or no-one (21%).
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