Is debt taking over your life?
For many South Africans, the burden of debt is all too real. Large numbers of South Africans are
spending significant chunks of their incomes servicing loans. Last year, a South Africa survey showed
that around five million South Africans are battling with over-indebtedness. That equates to 14% of
the population over the age of 16.

Some of this will be long-term debt in the form of home loans, but the real problem is short term,
high-interest debt in the form of personal loans, store credit and credit cards. The compounding
effect of the interest on this debt is what is eating into disposable incomes all over the country.

For anyone who finds themselves in a situation where their debt is overwhelming them, a first step
toward trying to address this may be debt consolidation. Most of South Africa’s major banks and
financial services companies offer these solutions. Debt consolidation is a good idea if you are

Debt consolidation is a good idea if you are battling to keep track of your debt due to it being spread across a range of accounts and loans, if you are unable to meet the monthly required minimum repayments or if you simply want to find a better rate. It is an effective way of taking control of debt as it allows you to merge retail store debt, short
term loans, personal loans and other credit card debt into one account. The principle idea behind
debt consolidation is that it allows an individual to pay off all their existing debts and be left with
only one remaining creditor.

Debt consolidation will not help consumers who spend above their means to curb their spending. In
order to make long term behavioural changes to spending, debt has to be actively paid off and a
deliberate effort to foster better spending habits and reducing expenses has to be made.