Great news about South African consumers – with a catch

South Africans’ financial confidence has reached its highest level in three years, rising from 47 in 2024 to 53 in 2025.

This is according to the 2025 Sanlam Financial Confidence Index (FCI), which surveyed over 1,500 participants aged 20 to 70 with personal income of at least R1,000. 

This study revealed that South Africans feel much more in control of their finances, yet still struggle to turn this confidence into consistent, long-term action.

Yugrow CEO and behavioural scientist Kele Boakgomo explained that, after years of economic instability, South Africans appear to be recalibrating their relationship with money. 

The survey found that many South Africans are finding strength in structure, with half of the respondents saying they could recover from a financial setback, up 11% from last year. 

“We’re seeing a collective shift from survival mode to control. Financial stress has forced new habits – people are protecting what they have, prioritising stability and learning to manage uncertainty,” Boakgomo said. 

SanlamConnect’s head of channel and segment marketing, Lee Hancox, said the growth in confidence may reflect a broader economic shift.

This comes as South Africa’s prime lending rate has dropped from a peak of 11.75% in 2023 to 10.50% in 2025, easing debt pressure and unlocking more disposable income. 

“Real salaries are rising for the first time in seven years, and inflation is stabilising, giving households a renewed sense of control,” Hancox said. 

“However, gaps remain, and we’re still seeing a worrying lag in financial wellness.” Hancox explained that South Africa is a confident nation – at least on paper.

Two in five people surveyed now have a high or very high FCI score, compared to just 27% in 2024. 

Encouragingly, 68% said they have the courage to live within their means, marking a 10% increase compared to last year.

In addition, 63% of South Africans surveyed feel on track to pay off debt, up 21% from 2024, and 58% believe they have the financial freedom to make life choices they enjoy, up 38%.

However, Hancox said that while optimism is growing, behaviour has not yet caught up. 

Confident on paper

Less than half of South Africans have written down their long-term goals or track them, and only 42% trust their own financial abilities. 

Financial Wellbeing (32) still lags well behind Financial Self-Determination (61) and Resilience (58).

While South Africans appear to be recalibrating their relationship with money, a confidence–action gap persists. 

“Confidence is only the first mile of change. People increasingly believe in their financial potential but still struggle to build habits and systems that turn optimism into outcomes,” Boakgomo said. 

“The next evolution will come from tools that make progress visible and habits automatic. When saving, tracking and paying down debt become part of daily life, confidence turns into capability.”

The survey found that most South Africans still feel stressed about their daily finances (74%) and are unhappy with their current financial situation (72%), while two-thirds feel uncomfortable discussing money.

The report said that while interest rates are coming down, and real salaries are increasing for the first time in seven years, people continue to feel the impact of high interest rates and income loss from Covid-19. 

“This may dampen confidence in people’s beliefs that they can build wealth in the future,” it said. 

“Furthermore, global uncertainty is taking a toll. The spike in mental health issues suggests many South Africans are struggling with well-being.” 

Interestingly, the survey found that Generation Z leads across every measure – from Self-Determination (70) to Resilience (64).

This is driven by optimism, digital fluency and openness to financial learning. Millennials follow closely, while Gen X and Baby Boomers, often stretched by multigenerational care or retirement pressures, trail behind.

Hancox sees this as a generational turning point, saying Gen Z’s optimism is an incredible opportunity. 

“They’re open to learning, curious, and digitally empowered. Our job is to meet them with the consideration and creativity they deserve – tools, content and advice that fit their world,” she said. 

“Gen Zs also seem to be hustling hard; their side hustles and multiple income streams may be making them feel more secure about their futures, but they need to invest their money and focus on growing wealth.”