CAPE TOWN - If you want to gain relief from the heavy load of debts, the first step to take is, to be honest with yourself, says a certified financial planner, Kim Potgieter.
As a debtor, you need to admit to yourself that you have these accounts and not to turn a blind eye as if your debts might flash away with the year 2017.
The South African Law Centre provides the following steps as a typical plan for a consumer to use to face debts head on:
1. List all debts with minimum monthly payments, interest rates and the total balance due.
2. Order them from the lowest total balance due to the highest due.
3. Once your budget works effectively and you have cut non-essential spending, you can add the extra cash to the debt with the lowest balance. With discipline, you will add more each month to that debt.
4. When this debt paid up, you can add all that extra money to the next debt on your list. See how quickly that debt drops.
5. Continue the cycle, until you are more comfortable with your debt levels, or you are totally debt free.
During the festive season, people want to mingle with good people, wear notable clothing at events, drive flashy cars and visit the best holiday resorts on earth, but this shouldn't affect your monetary plans for 2018.
The Credit Ombud, Nicky Lala-Mohan says, "Many women find themselves paying today, what they bought yesterday by borrowing from tomorrow".
The TransUnion Consumer Credit Index depicted a slight decline in Quarter 3 of 2017, though it continues to reflect marginally improving consumer credit health.
Late in November, the CEO of TransUnion, Lee Naik advised consumers to buy what they need during the festive season so as to stay away from the debt trap.
- BUSINESS REPORT ONLINE