As we are all aware, the increased cost of living has put many South African consumers under more pressure this year. Inflation and rising fuel costs have increased the day to day expenditure for consumers. To fund a similar lifestyle consumers resort to taking out debt bridge the gap. Personal loans and credit cards are used extensively for food and other basic living expenses.
Festive Season Pressure
The pressures of the festive season only add to the list of expenses which can push consumers into a debt spiral. Using debt to pay for festive season food, entertainment and gifts may be the only option for many. Vantage Debt Management wants consumers to be wary of overdoing it. Before committing to a new loan or large credit card expenditure, make sure that the additional monthly repayments on such new credit are affordable.
Tips To Save Money This Festive Season
- Buy food and drinks in bulk to cut down on costs
- Create a holiday budget and review as often as possible
- Don’t use new debt unless it is necessary
- Set realistic expectations for family gifts
- Host parties or events at home rather than going to expensive restaurants
- Opt for free holiday activities such as a beach visit or picnic in the park
Watch Your Debt Repayments
Debt repayments can creep up unexpectedly. It is very easy to swipe your credit card and feel like you’ve spent no money, but it is important to keep a close eye on this. Make sure that your debt costs are part of your monthly or weekly budget. Your debt repayments should never really be more than 50% of your monthly income, of course this is a rule of thumb and is relative.
Pay off your debt as quickly as you can. You will save money on interest and fees in the long run. Try not to fall for store card offers or schemes. The vouchers or free gifts might seem appealing at first, but often these are used to rope in new clients. Credit providers are seeking new consumers to join them and use their facilities for life.
What To Do If You Already Have Too Much Debt
If your debt is already high and you are struggling too juggle debt repayments, here’s what you should do:
- Draw a credit report to see exactly how much you owe and to who. Credit bureaus offer one free credit report per year, so there is no cost for this prudent exercise.
- Approach a debt counsellor for a debt assessment. A debt counsellor can help you make the right decision regarding your debt.
- Solutions such as debt consolidation or counseling can help you get out of debt by reducing your monthly repayments.
- Do not use debt to pay off other debts as this can lead to a nasty debt spiral
If you are seeking professional help, chat to the experts at Vantage Debt Management, for a free full financial assessment. Fill out their callback form or call them on 087 238 2749. Vantage is registered with the National Credit Regulator, and complies with the rules and regulations of the National Credit Act.