Here’s some rather disturbing news: South Africa is the most over-indebted nation in the world. We’re not kidding.
In reality, that means that 11 million South Africans are three months or more behind on their repayments.
If you or someone you know are one of those 11 million, we promise there is hope! Glen Jordan, Director of the financial firm IMB, has given us a solution. With these eight guidelines it is totally possible to get out of debt – and remain debt-free!
1 Wait 30 days until you buy something
We know this sounds, well, impossible, but when you’re trying to manage your debt it’s one of the best things you can do. Wait 30 days before buying those heels, and if you still feel you ‘need’ them after that time, then you can buy them. Unless it’s a house or a car, wait until you have the money – then buy it.
2 Always read the fine print
And we mean always. ALWAYS. As soon as you sign a document you are bound to its terms, so never sign anything without reading the fine print first. Yeah, we know it’s a mission, but before you agree to buying that new 3D TV in monthly instalments, read the contract in full and ask questions.
3 Be responsible around holidays
You’re high on the festive spirits and in a giving mood, and buying each of your besties a designer bag on credit just feels like a good idea. After all, it’s Christmas right? Wrong. During Christmas, New Year and other holidays, we are notorious for spending money we don’t have. Yes, these are times for celebration, but just remember that when the festive cheer dies down, you need to pay that money back. Gulp.
4 Curb your spending
It goes without saying that when you’re in the red, you need to kick the habit of compulsive spending. The worst thing you can do is take out more loans to fuel your spending habits. If you’re in debt, spend less. That’s the real solution.
5 Acknowledge your debt early
Denial is real, and it can keep people trapped in the cycle of debt for months. The first proactive move you can make is to speak up. Once you communicate and admit your problem, you’ll empower yourself to find the solution.
6 If you need a fast loan, make sure you can pay it back
For obvious reasons, loans are never ideal (you end up spending more than you borrowed). But if you really do need a fast injection of cash, make sure you’re not borrowing a fortune you could never hope to pay back. You run the risk of being blacklisted, which means you can never borrow money again.
7 Know your rights
Even if you’re seriously drowning in debt, there is still hope at hand. The majority of people don’t know that there’s an actual solution, but South Africa has strict rules designed to protect the consumer in matters of severe debt. So stop thinking debt is a reality they you’ll never escape, it’s not true.
8 If you’re borrowing money you can’t pay back, you’re not the only one at fault
If you borrow money you can’t pay back, you may not be the only responsible party. Thanks to your rights and our laws, the lender also has a responsibility to check that you are a suitable candidate and that you can afford to pay the money back before lending it to you.
Avoid going into the red by learning how to make your salary last ALL month, and ensuring you keep your financial resolutions on track.
