By IPS Correspondents
CAPE TOWN , Apr 8 2005 (IPS)

South Africa’s first comprehensive look at the financial lives of poor families has uncovered a fascinating world where things are not always as they appear.

A well-dressed teacher is about to drown in a tsunami of credit card debt, while a threadbare domestic worker has a nice pile of cash, carefully hoarded coin by coin, tucked away for the day her pre-school daughter eventually enters university.

But the Financial Diaries project has uncovered the common enemy of every savings strategy. Death, it seems, is murder on your wallet – no matter how well you plan for it.

Thembi* scrapes by with a disability grant, an occasional spot of work as a cleaning lady, and the luxury of secure housing after the single mother inherited the family home in the dusty Cape Town township of Langa. The 50-year-old is considered sufficiently well-off that relatives in another of the port’s townships, who have to use a communal public toilet, have asked her to take in a teenage cousin who is sick with HIV.

Then her brother died of tuberculosis. Her parents had died a few years earlier. Another brother had been brutally murdered by his girlfriend’s former boy friend. Burying her brother, she knew from experience, would cost nearly 1,600 dollars.

”Thembi was very worried because she didn’t know who was going to help her with the funeral expenses,” remembers Daryl Collins, the director of the Financial Diaries. ‘’She had to go cap in hand to her relatives to make the requests and sit through the discussion that came after the requests and she was very bitter about this.”

Financial Diaries fieldworker, Nomthunzi Qubeka, herself from a long-standing Langa family, has been visiting Thembi every two weeks for over a year, documenting her little-known financial world. She found that Thembi had regularly put aside money in a burial society but the savings were not nearly enough to cover the costs.

This shortfall is common in both the cities and the countryside, and puts huge pressure on the extended family.

”In a village known as Lugangeni, a single mother who had been dependent on her own mother’s old age grant was hit twice when her mother died. First she lost that source of money. Then she found that only 45 percent of the cost of her mother’s funerals was covered by her mother’s burial society. More than half of the money had to come from relatives,” says Collins, whose work falls under the Southern Africa Labour and Development Research Unit (SALDRU) at the University of Cape Town.

Collins says, ‘’Funerals are expensive, everybody knows that. What’s new about our research is that it shows people being constantly asked for substantial amounts of money for the funerals of distant relatives. Eighty percent of our rural households had to dig into their pockets at least twice during the study. That’s a lot of pressure.”

In the end, Thembi paid for her brother’s farewell from a dozen different sources. One relative was prevailed upon to rent the striped tent which sheltered the overflow of mourners at the service at her home. A second reluctantly rented the pots to feed the mourners. Another bought the sheep to slaughter to feed the many relatives preparing to return to their rural homes far to the east.

”In the urban areas, people aren’t asked to help out with funeral money as often but they’re asked for larger contributions,” says Collins, who gave up a career as a Wall Street economist to pursue a long-standing interest in understanding the financial management systems of the poor. ‘’And this constantly interrupts their cash flow and means they can’t plan.”

South Africa’s Financial Diaries, far bigger than earlier projects in India and Bangladesh, reveal that the bulk of funeral expenses go to feed the living. Food for the mourners formed 60 percent of the cost facing grieving survivors in one family. Sometimes, funeral food costs more than the undertaker’s bill.

”That’s why many burial societies are very specialised,” says Collins, who this week has a seminar on her findings at the Centre for Social Science Research (CSSR) at the University of Cape Town. ‘’One society might just deal with undertaker costs, and you put aside a regular amount of money for that every month. Others rotate around food – so instead of regular deposits, it’s like ‘this is your time to bring the butternut’. I found in the Mount Frere district of (South Africa’s) Eastern Cape (province) that most of the households had at least one of these village-wide burial societies in their financial portfolio.”

Funeral costs are a ‘’very big” financial issue, notes the Eastern Cape fieldworker, Busi Magazi. ‘’If you can’t even afford a burial society, then you are considered very, very poor. Most people belong to at least two; one for groceries, one for the coffin.”

Many South Africans adopt a very pragmatic attitude to death. Some highly-educated middle-class people confess to being completely superstitious about death, refusing to fill in a will for fear it will trigger their own passing, and thus leave their families with frozen bank accounts and utter confusion.

Poorer people have no such illusions about immortality. Many of the participants in the study put aside money into at least one burial society because they were concerned about the impact their own death would have on the family’s already-stressed finances.

Sylvia, a cleaning lady in South Africa’s commercial hub of Johannesburg, contributes to two. ‘’You must have a plan or society in case you die so that your family does not suffer,” the single mother explains at her home in Diepsloot informal settlement.

She joined an informal savings group with people from her home village in Mpumalanga Province as well as a formal bank funeral plan ‘’because societies can always go bankrupt but with a bank you know your money is safe.”

But the money is never enough.

Some clergy have accused South Africans of wasting precious money on splashy funerals designed more to attract social butterflies than remember the deceased. But the researchers say the jury is still out on this claim.

”Many people say they’re doing the same thing they’ve always done,” says Collins. ‘’They say the cost of food and other items has increased.”

Some of her researchers reported one cutback. The lengthy evening prayer service in the week or two preceding the burial used to serve scones, tea and coffee. ‘’I have been told that people no longer provide this because of the expense,” Collins says.

A fellow academic at the same university, Nicoli Nattrass of the AIDS and Society Research Unit (ASRU), is convinced that deaths from the AIDS epidemic are slicing increasingly deeply into the limited finances of poverty-stricken households. In Thembi’s case, for example, two uncles died soon after her brother passed away, causing yet more financial crises.

But the 160 households in the Financial Diaries project proved tight-lipped about the reasons for deaths – possibly because of the South African government’s alliance with AIDS denialists. Or its objections to life-prolonging anti-retroviral drug therapy. Or maybe it is because family members are dying of malaria or tuberculosis, so the link to AIDS is not so visible.

”When you ask, ‘do you have more funerals than you used to?’ many people say ‘yes, a lot more funerals’,” notes Collins cautiously. ‘’But they don’t say why.”

An even more detailed analysis of the hidden financial world of the poor will soon be online at FinancialDiaries.com. ‘’It’s amazing research,” said economist Martin Wittenberg after attending the Financial Diaries seminar this week at the University of Cape Town’s Centre for Social Science Research. ‘’People will be mining information from the data for years.”

* Names changed to protect their confidentiality.

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