How Black Tax is impacting South African families' finances

For many South Africans, the salary that lands at the end of the month barely covers the essentials.

Between raising children, supporting ageing parents, and shouldering the often-unspoken burden of Black Tax, there’s little left for anything else, says Atlas Finance.

A University of Johannesburg study found “Black Tax has a substantial financial burden on millennials, impacting their social mobility, emotional well-being, family structures, and retirement preparedness”.

Atlas Finance, commenting on the Competition Commission’s Cost of Living Report, says households are being pushed to breaking point.

Rising prices for basics – food, fuel, electricity – are squeezing wallets, forcing families to make impossible choices just to get by.

The ongoing energy crisis has sent electricity tariffs soaring, hitting lower-income households hardest.

According to the Competition Commission, the average South African worker now spends more than 57% of their monthly earnings on transport and electricity alone.

That leaves almost nothing for groceries, school fees, or unexpected bills. Add steep interest rate hikes on home loans and credit, and juggling expenses becomes a daily balancing act, it said.

This is the reality for the sandwich generation – squeezed between financial responsibilities for children, parents, and sometimes even grandparents, said Atlas Finance.

Old Mutual’s 2025 Savings & Investment Monitor shows the percentage of households supporting multiple generations rose from 41% in 2024 to 44% in 2025.

Niresh Gopichand, Atlas Finance’s Risk Director, said, “We can’t stop prices from going up, but we can change how we respond.”

Gopichand said that “small shifts, talking openly about Black Tax, cutting hidden costs, responsible borrowing, or using loyalty cards, can be the difference between sinking deeper into debt and keeping your family afloat”.

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