In the current economy, with South Africa downgraded to junk status, it is wise to reduce your debt as far as possible. It might be easier said than done.
The question is, how do I reduce my debt?
- Take control of your finances and know your budget
Firstly, I would suggest one take control of your budget. Compile a simple income and expense forecast of what a typical month will look like. Keep your expenses aligned with your budget as planned or forecasted as far as possible.
- Limit the amount of borrowing to the bear minimum
Do not open clothing, furniture or other similar accounts. Rather save for something you really need, than do purchases on credit. In most cases you will find that the item want today, will not necessarily be appealing to you in 3 – 4 months.
- Pay more than you need to
If you have some funds available in your budget, do an additional payment on your bond or hire purchase monthly. The accumulative effect on the interest saved will speed up the time of repayment of the item quicker.
- Get help from a debt counsellor
Call in the help of a professional debt counsellor when your debt gets out of hand and BEFORE any of your creditors start pursuing a legal action against you. For more information about this you can contact our debt counsellor for more information and assistance about this. The debt counsellor will assist you with a repayment plan to your creditors, on your behalf.
We hope that the above article assisted you. Contact one of our consultants below for assistance.