CONSUMERS who swipe their cards left and right end up having more and more holes to fill with too little money. Freepik
Based on the results of the latest DebtSafe Financial Reality Survey, many South Africans are caught up in a “mindless swiping culture”. This is because of the exploitation of consumers’ shopping experiences, the desire for instant gratification, and how easy it is for consumers to swipe store, credit or awards cards, says DebtSafe debt adviser Carla Oberholzer.

“Consumers who swipe their cards left and right end up having more and more holes to fill with too little money. They can’t shy away from this ‘no-thinking, just swiping culture’ that has been created. This type of behaviour can cause serious damage to mental health, physical well-being and financial prosperity,” says Oberholzer.

According to DebtSafe’s survey, 46 percent of the more than 1000 respondents said they were not up to date with their debt repayments.

Oberholzer says respondents typically indicated they were in arrears with retail credit agreements, such as clothing and store accounts (44 percent), and credit cards and overdrafts (30 percent).

She says that, according to Old Mutual’s 2019 Savings and Investment Monitor, 29 percent of consumers surveyed mainly use a credit card for everyday expenses, and the main reason that 67 percent of consumers use a store card is to buy things that they don’t have the cash for.

The Savings and Investment Monitor found that 35 percent were “just about getting by” financially, 20 percent were finding it quite difficult, and 9 percent were finding it very difficult.

The monitor also found that, when it comes to consumers’ level of financial stress, only 11 percent said they had no stress at all, 44 percent had low stress, 38 percent had high stress, and less than 10 percent were overwhelmed by stress.

Oberholzer says debt can also seriously affect your mental and physical health.

She says that 56 percent of the respondents to DebtSafe’s survey indicated that financial stress has influenced their overall level of stress, 40 percent said it affected their sleep patterns; and 29 percent said it disrupted their decision-making abilities.

“It is time for South Africans to go back to their financial drawing boards and be done with creating or being part of a ‘mindless swiping culture’. They should think about setting a plausible behavioural pattern and example for their family and friends to pursue,” says Oberholzer.

In this regard, she has the following five suggestions:

* Use credit only when it is absolutely necessary. Do not use credit to cover basic living costs, such as fuel and groceries, but only for an unforeseen emergency.

* Set up a monthly budget to make sure you know where you are financially (net income minus investments/savings and expenses equals a surplus or minus that is left for the rest of the month).

* Expenditure should not exceed income. Do not live beyond your means, or you could find yourself severely over-indebted.

* Pay off the balance on your store or credit card each month, to avoid paying interest.

* If you are drowning in debt, speak to your bank or ask the National Credit Regulator whether debt counselling would be a feasible option. This process protects over-indebted consumers and has a “rehabilitative spirit” to prevent any excessive swiping during the duration of the programme. 

PERSONAL FINANCE