CAPE TOWN - The festive season frenzy might lead to consumers forgetting about their primary important credit commitments, says Wesbank.
This seasonal excitement comes with extreme retail overspending, ad hoc travelling and expensive holidays which may impact consumers who are dependent on credit facilities to finance these expenses.
Wesbank's head of brand and communication, Rudolf Mahoney said: "Every year, in January to March, there’s a spike in debt review applications. These are more than likely people who have heavily relied on credit in the previous year, and then overspent during December".
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Pieces of advice to consumers:
1. Don't spend what you don't have
Have patience and only spend what you have in the bank and resist the temptation of early festive deals, because these could have a negative impact on your budget.
This is especially important in the current uncertain economic climate, where businesses may struggle to afford rewarding employees with bonuses.
2. Early December paycheques are for January
Most businesses pay their employees early in December in consideration of holidays. Consumers tend to blow their salaries in December and forget about January.
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Consumers should rather transfer those early December salaries to savings accounts, and use them for January’s commitments.
Failure to do so will result in missed payments, such as vehicle loans instalments, which is an immediate negative for any credit score.
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Mahoney further advised that consumers should think beyond festive deals to keep control of their credit commitments.
"Careful planning and responsible spending are far more rewarding than taking advantage of festive deals, or using additional credit facilities to accommodate a way of life you cannot afford," he concluded.