Is debt controlling your life? Here is what to do if you are over indebted in South Africa.

By The National Debt Review Center

Feeling Buried in Debt?

Feeling overwhelmed by bills and struggling to keep your head above water? You’re not alone. Over-indebtedness is a prevalent issue in South Africa, impacting countless individuals and families. But don’t despair! With the right approach, you can overcome this challenge and regain control of your finances.

What is Over-Indebtedness?

Over-indebtedness occurs when your debt exceeds your ability to comfortably manage repayments. This can happen due to various factors, such as unexpected expenses, job loss, high interest rates, or simply living beyond your means.

Signs that you might be over indebted.

1. Missing debt repayments. Struggling to make minimum payments on time.
2. Relying on credit. Regularly using credit cards or loans to cover everyday expenses.
3. Feeling overwhelmed. Experiencing stress, anxiety, or depression due to financial burdens.
4. Constant borrowing. Taking out new loans to pay off existing ones.

What causes people to be over-indebted?

There are various factors that contribute to over-indebtedness in South Africa. Some key points to include.

1. High unemployment, low wages, rising living costs, and access to easy credit.
2. Poor financial literacy, impulsive spending habits, unforeseen emergencies (medical bills, car repairs), and gambling addiction.
3. Aggressive marketing of credit products, high interest rates, and hidden fees.

What to do if you are over indebted in South Africa?

Before seeking professional help, consider these self-help strategies:

1. Create a budget. It’s the foundation! Track your income and expenses to identify areas where you can cut back. Use budgeting tools or templates available online.
2. Negotiate with creditors. Contact your creditors and explain your situation. They may be willing to lower interest rates or offer flexible payment plans.
3. Reduce your monthly expenses. Embrace a frugal lifestyle. Cook at home, seek free entertainment, and cancel unused subscriptions.
4. Explore ways to increase your income, like taking on a side hustle or negotiating a raise.

When It’s Time to seek Professional Help?

Sometimes, self-help isn’t enough. Consider seeking professional assistance if:

• You feel overwhelmed and unable to manage your debt alone.
• Creditors are taking legal action against you.
• You need help negotiating with creditors or restructuring your debt.

Registered debt counsellors can be invaluable allies. They assess your financial situation, negotiate with creditors on your behalf, and guide you through a debt repayment plan.

Book an appointment with a registered debt counsellor.

In extreme cases, seeking legal advice might be necessary, especially if facing legal action from creditors. A lawyer can advise on your rights and options in such situations.

Remember, you’re not alone. Numerous South African organizations offer support and resources for those struggling with debt. Here are some helpful contacts:

• National Credit Regulator (NCR): 0860 627 627
• The National Debt Review Center (NDRC): 041 0125 036

Stay Positive and Take Charge.

Overcoming over-indebtedness takes time and effort, but with the right approach and support, you can achieve financial freedom. Remember, you’re not powerless. Take control of your finances, seek help when needed, and believe in your ability to get back on track.