The majority of South Africans will retire with insufficient resources, the chairperson of the SA Savings Institute (SASI) said in Johannesburg on Friday.

"Many of us will experience a significant reduction in our welfare, to the extent of living close to the poverty line," Elias Masilela said at the launch of Savings Month 2008.

He said that the replacement ratio – which expresses the percentage of a person's final salary needed to maintain living standards in retirement – averaged less than 30 percent in SA as compared to 56 percent in the OECD and 75 percent in North African states.

"This is a direct function of a poor savings performance, unsustainable cost structures, early withdrawals and investment performance over time.

"It can be shown that for people to be able to retire comfortably, they may have to save an extra 25 percent of their income for this purpose."

He said the psychology of SASI's campaign was made even more difficult by the "intangible benefits and the attendant risks of not saving – which only became realized way in the distant future".

He said if one compared SASI's campaign to other campaigns, which were more visible and affected individual's bottom lines almost completely, such as HIV/Aids, one could see the significantly tougher challenge of convincing people to save.

Masilela said that this year the Saving's Month campaign would focus on the youth.

"This will get them to understand the value of saving and hopefully embrace it early enough in their lives.

"As parents, we are charged with the responsibility of grooming our children into responsible leaders... more importantly, in furnishing them with the requisite skills of overcoming youth unemployment and poverty."

The youth needed to understand that their future lay in their hands, and that they should save more and never live beyond their means, Masilela said.

Sapa