This time of the year is chaotic for many South Africans. The thought of returning to work could make you queasy but the reality of the situation is that you need your salary to pay off the debts you incurred over the festive season.
If you are one of those people who’s spent recklessly in the past last year, you're not alone. Thousands, if not millions of South Africans overspent last year. As we enter into the New Year, many of us are riddled with debt that we cannot recover from.
To provide insight on this matter, Head of FNB's Consumer Education Program Eunice Sibiya chats about borrowing, and why it plays such an important role in your ability to grow your wealth.
Sibiya says that there’s a concerning number of South Africans that are flat broke, she adds that this is due to borrowing money despite the consequences.
More than half of consumers that are credit active owe 75% or more of their income to creditors.— Eunice Sibiya, Head of FNB's Consumer Education Program
Sibiya says that there are three main areas where outstanding debt is most prevalent among South Africans:
1. 94% are late with payments on personal loans
- 84% can't make payments on credit cards
- 76% are struggling to pay store cards
The majority of us find ourselves in this bracket and it stresses us out, says Sibiya. She adds that according to the South African Human rights Commission, more than 50% of the 19 million credit-active consumers in the country have impaired credit records.
Sibiya says that as a collective, South African consumers are in serious debt. She adds that if we don't do something about it, then it will only get worse.
Click on the audio below to hear more...