Last week saw the petrol price increase to above R15 per litre for the first time in South Africa. This pushed many consumers into a flat panic. Not only will their daily commutes cost a whole lot more, but the knock-on effects of the increase priced on other products and services is sure to hurt their wallets as well. With steady annual inflation and often flatlined salaries, consumers are already feeling the pinch of a more expensive monthly basket of goods. Timeslive reported that Mmusi Maimane approached parliament stating that the petrol price increase should be treated as a “matter of urgency“. He said that ““Without a growing‚ vibrant and inclusive economy‚ we will never address the injustices of our past‚ and create opportunity for our young people to pursue their own destiny.”
South Africans Are Feeling The Pinch
The majority of South Africans have had to make large spending and lifestyle adjustments over the past few years. It often seems as though there is no relief in sight. Increase after increase in prices is putting many consumers out of pocket. Often, the only relief comes in the form of short-term debt. Although this may provide a temporary sense of financial security, short-term debt can have longer term consequences.
In South Africa, there are over 25 million credit-active consumers, of which over 10 million are in arrears. This means that more than 40% of consumers with debt struggle to pay back some of their debts. Amendments to affordability assessments by credit providers have attempted to rectify this, but the desired results have not yet been proven.
The Petrol Price Increase Could Force You Into Debt
The increase in the petrol price will eat up more of everyone’s disposable income, leaving less for other items. Consumers will resort to taking out short-term loans, pay-day loans and using credit cards to make up for budget shortfalls. South Africans need to learn to budget better and not to take out any form of debt that cannot be easily paid back. By missing or short paying loan repayments, you negatively affect your credit score and also get penalized by high fees and charges. A decreasing credit score will affect your chances of taking out more credit down the line. It could even affect your employment opportunities in some instances.
Try To Save Money With These Transport Tips
To offset the increase in transport costs consumers can try finding ways of saving money. Instead of driving to work and back by yourself every day, try to carpool with someone in the office. Split the petrol costs and have a buddy to chat to on your daily commute. Investigate using public transport if and when possible. You could also save petrol by driving better and by making sure you take efficient routes when going about your daily activities.
If you find yourself struggling to budget and pay back debt you need to consult a debt counsellor. You may be over-indebted in which case you should look for some sort of debt solution. Debt counsellors can assist with debt relief programs such as consolidation products and debt counselling. It’s important to seek help sooner rather than later so that you can get your finances back on track and have a better chance of being rescued before legal action or repossession take place.