South African households collectively spend R3 trillion annually

Stats SA has revealed how South African households choose to spend their money, with households collectively spending an estimated R3 trillion between November 2022 and November 2023.

The average annual household consumption expenditure amounted to around R143,691 during the survey year, according to the findings of the Income & Expenditure Survey (IES) 2022/2023 by Statistics South Africa (StatsSA)

The report offers insights into spending patterns of households as well as highlights the financial priorities that shape SA's household economy.

SA households allocated 75,6% of their total household spending towards four main areas in 2023 which means that three out of every four rand was directed toward these essentials.

The four categories are:

- housing and utilities

- food and non-alcoholic beverages

- transport

- insurance and financial services.

While the average annual household consumption expenditure in 2023 was R143,691, the median household consumption expenditure was much lower at R82,861.

The disparity between the average (mean) and median annual household consumption expenditure in South Africa points to a major income inequality within the country, according to StatsSA. 

A large portion of the population spends well below the national average which pulls the median household consumption expenditure down.

The gap between the average and median expenditure is a clear indicator of the unequal distribution of resources, with the wealthier households spending habits skewing the average, while most households operate with much lower expenditure levels.

Male-headed households spent an average of R159,315 and accounted for just over 60% of total household consumption expenditure while female-headed households, contributed slightly less than 40% and spent R123,346 on average.

IOL Business