73% of South Africans will have financial complications by 2022
The economic crisis worsened by the Covid-19 pandemic has made it really hard for South Africans. 73% of the population will have financial complications this year and will find it hard to pay off their debts.
According to a recent survey carried out by Deb Rescue, 73% of South Africans will develop serious economic complications by 2022 for not being able to make ends meet. This same survey showed that a striking 76% of South Africans’ income is used to paying off debt.
The end of the year is usually the time of the year when people go the extra mile for buying presents for their family, especially for children. However, in the current context, this behavior may bring about financial complications for many South Africans. Since many people find themselves with no cash for buying presents, they use their credit cards or even ask for a loan.
At the same time, fuel prices have soared the last quarter of 2021, as well as electricity and food. Thus, a South African needs to make more money each month in order to get by. The rate of unemployment is currently at 34.9% according to the Department of Statistics of South Africa. A figure that is not very promising in the midst of this crisis.
The Covid-19 pandemic and all its variants have posed a great deal of stress on the economy of South Africa as well as in the rest of the Globe. And although the Government continues vaccinating the population, the pandemic is far from over. In addition to these efforts, the Government of South Africa has released a number of economic measures to aid businesses and individuals during this sanitary crisis.
All these factors have had an impact on the daily economy of South Africans, who find it more and more difficult to make it till the end of the month. Also, many of them, in their urgent need for money, might make poor decisions when it comes to asking for loans. It is important that consumers become more aware of the great responsibility entailed in asking for a personal loan.
There are two main factors to take into account when asking for a loan: the budget and the reliability of the financial company. Budgeting can be your best tool to maintaining a safe financial behavior. One way of finding out your budget is writing down on a piece of paper how much money you earn each month and how much money goes into paying bills, buying food, paying for the children’s school, and so on. The money left is the money you can use for other expenses, such as for paying off a loan.
Not figuring out a budget is one of the most common mistakes made by South Africans. They ask for a loan, and then they are unable to pay for installments. Or worse, they ask for a second loan to pay off a loan, getting themselves into a snowball effect. The best way to go about our economy is to budget ourselves and live with the money we earn. If the money we earn is not enough for us to cover our everyday expenses, then we might want to consider finding another job or starting our own business.
On the other hand, finding out how reliable a credit company is can be as important as drawing up a budget. Asking for an online loan at renown credit companies or banks will keep you on the safe side. There are many things you can do to find out if you can trust in a credit company or not. These are a few tips:
- Is the company registered with the National Credit Regulator?
- Does the company provide you with contact information, and it is easy to reach them out?
- Is the company located at a real address?
- Do you know anybody who has successfully asked for a loan at that company?
- Can you find reviews about the company online?
If the answer to most of these questions is no, then you might as well keep away from that company. Sometimes, when you are in need of money and your economic or financial situation is not promising, the best thing might be to ask for a relative or a friend to lend you a helping hand.
Another resource for people with financial needs could be to ask for financial assistance by the Government. Also, there are a great number of NGOs that provide financial aid to South Africans that might be helpful. For instance, if putting your children into higher education is an issue for you, you might want to try the different student financial aid programs offered by these organizations.
The economic crisis worsened by the Covid-19 pandemic has made it really hard for South Africans. 73% of the population will have financial complications this year and will find it hard to pay off their debts. Better practices in terms of financial education might help South African prevent from being over-indebted and being under debt review.
