For most of the South African consumers that are currently seeking an urgent financial solution to make ends meet, there are already tell-tale signs that they should consider a debt intervention programme like debt counselling.
“It’s these evident signs that needs to be highlighted to the more than 12 million consumers that have one or more credit accounts in arrears already, and who need to understand that their next option is most likely not another loan,” says DebtBusters COO Benay Sager, commenting on National Debt Awareness Week campaign that launched this week.
DebtBusters have seen an increased amount of inquiries since October last year (25% more than other years), but engagement with these consumers still show that many do not know that there are formal and regulated solution available that could help them get through the tough financial situations they are currently facing.
“As we manage to reach and engage with more consumers who are feeling the strain of the current tough economic climate, we also encourage them to have a better understanding of their credit report and to be aware of the signs that they might be over-indebted already. They should consider other ways to unlock a better cash flow to afford their daily living expenses,” adds Sager.
Tell-tale signs you need help with your debt
Here are some of the most prominent tell-tale signs that you need assistance with managing your debt:
- You are taking out more credit to pay off your debt.
If you find that you are taking out more loans to help pay off existing loans, you are only creating a bigger debt hole for yourself, and it is time to seek help before the debt accumulates to a totally unmanageable point. - You are taking out credit to help make ends meet.
Using credit to cover your living expenses because your salary is not lasting until the end of the month is not a sustainable solution. If you are dependent on credit cards, loans, store cards and overdrafts to buy food and pay for everyday expenses, you are already on the slippery slope towards a financial crisis. It is only a matter of time before you run out of credit. - You are unsure how much money you owe creditors.
If you are avoiding your debt it may be because you suspect you owe more than you are able to handle. Ignoring your debt obligations will only make the situation worsen. You may also be avoiding your credit report because it holds the truth to your financial reality. Checking your credit report is an important first step to controlling and improving your financial health. - You are avoiding answering phone calls because it might be your creditors calling.
If you are skipping payments and avoiding calls from your creditors and/or debt collectors, it is definitely time to seek a solution before your creditors start taking legal action against you. - Worrying about your debt is causing you to lose sleep.
If you are losing sleep over your debt, approaching a debt counsellor to assist you can help give you peace of mind because your finances are back on track.
Consolidating your debt into one lower monthly instalment and freeing up cash flow can save you thousands of Rands and help you to pay off your debt instead of incurring more.
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