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More month than money? You’re not alone: South Africans are notorious for their unhealthy love affair with debt. And we’re ignorant about the basics of personal finance, such as budgeting, saving, goal-setting, managing debt and knowing our creditworthiness.

Almost half of us, or 25 million, are in debt; at least 58% of people struggle to meet monthly repayments; 40% of us are behind on our repayments, 39% have at least one account overdue; and, a 2014 World Bank report noted, we’re the world’s biggest borrowers, surpassing Kenya and the US by a wide margin.

With stubborn unemployment levels, more of us have loans than work. Caught in a debt spiral, South Africans owe R18 billion in unsecured store and credit card debt, and 73% of disposable income is spent just on servicing debt.

Having bad credit on our names or a low credit score means that credit for big-ticket purchases such as homes, education, vehicles and even insurance is more expensive or even impossible to access. Interest rates are higher, too.

Whether or not you’re caught in a debt spiral, we can all work on improving our financial wellness and to do so, we need an honest assessment of the status quo.

The National Credit Act entitles all South Africans to a free credit report once a year from a credit bureau. But with the four major credit bureaus, TransUnion, Compuscan, Experian and XDS, using different listing criteria, it can be pot luck for consumers - and they don’t obtain a complete snapshot of their credit profiles.

Enter Kudough, which works with clients to improve their financial wellness, starting by gathering credit information from all four bureaus to provide a comprehensive overview of the data. They claim to be able to improve clients’ credit scores by an average of 22 points a year and reduce debt by 21%.

Experts at Kudough Financial Rehab, which is in partnership with the Intelligent Debt Management Group, say the tendency towards going into debt, fuelled by high unemployment and a historically lax credit lending industry, has not only eroded the personal financial capacity of millions of South Africans, but has also negatively affected their physical and mental wellbeing.

It says recent credit bureau statistics indicate that one in five people finds incorrect information on their credit reports, which could result in higher interest rates on loans - or for them to be declined. An estimated 87% of South Africans have errors on their credit reports.

Last year, 17% of people who pulled their credit reports and found errors on them challenged the wrong information and two-thirds were resolved in favour of the consumer. Reviewing your credit report data can also prevent you from falling victim to identity theft.

Kudough enables clients to identify potential savings from their existing credit agreements or day-to-day spending. Following personal goals set out for you will also enable you to lower your debt, increase your credit rating, obtain better interest rates on loans, help you to qualify for home or vehicle finance, and empower you to save. Regularly checking your credit rating could also help to flag identity theft.

“To help you put together a workable budget, deal with debts, identify areas for greater financial control and improving your credit score cannot be overstated. It is equally important to put a plan in place to look after yourself. Because focusing on your mental health will directly improve your financial health,” Kudough says.

The company offers one free credit report through a leading bureau and subscription services, starting at R25 a month per bureau. This also gives customers access to other services, such as discounts, alerts, credit deals, status improvement goals and vouchers.

Janike Stiglingh, Kudough’s marketing manager, says their business model - of providing credit scores from the top bureaus - evolved to service the financial needs of their customers.

“If you’re drawing a credit report from just one bureau, you only get a broad overview - and not the complete picture. For example, you’d see you are listed for Edgars with XDS, Telkom with TransUnion, etc.”

But it wouldn’t show that you have a listing elsewhere that is preventing you from accessing credit.

“Two years ago, we remodelled the company to offer financial services. We identify where people are overpaying for credit life insurance, identify debt counselling or consolidation opportunities, savings with major brands - coupons with Checkers, flight discounts with Mango and Kulula, Hirsch’s, Le Creuset, Netflorest, spas, Hollard etc.

“You can opt in for a quarterly report - or sign out at any time.”

Whether or not you’re in need of financial rehab - or want to improve your status - using such a tool can help guide you to stability.

Kudough says the journey to improving your finances starts with regularly reviewing your report and from there on they do the “heavy lifting” - identifying debt improvement goals to help you succeed. And if you don’t, you’ll get your money back.

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