South Africans face cost of living crisis – but there is a solution
2026 has been a tumultuous year economically, with major fuel price and electricity tariff increases headlining the list of challenges South Africans face.
Many South Africans are taking out bad debt to manage their financial difficulties – but this is digging them deeper into their financial hole.
“We are seeing more people relying on debt to carry them through these economic times,” said Neil Roets, founder and CEO of Debt Rescue.
“They are doing this through various forms of debt – credit cards, store cards, and some retailers are even giving out credit to buy groceries with.”
If people are relying on debt to pay for their day-to-day expenses, they will find themselves in a tough financial predicament.
How to avoid bad debt
According to Roets, the easiest way to avoid falling into a bad debt scenario is to have a budget in place.
This ensures you know exactly where your money is going.
“It’s concerning to see how many people don’t know what is going on in their finances,” said Roets.
“You must run your own finances like you are running a business. That is why having a budget is so important.”
Having a budget also helps you determine why you are not going to make it in a specific month.
“Ask yourself: ‘is my problem a once-off thing, like a car breaking down? Or am I living a bit too high a standard of life,’” said Roets.
You can then determine whether there is a way to exit your debt situation by adjusting your spending habits, or if other actions must be taken.
Apathy is the silent killer
If your debt is too much for you to handle alone, Roets’ advice is to seek help early.
Entering debt review where a registered debt counsellor can assist you to manage your finances, can be a very successful solution.
Roets explained that in the form of the National Credit Act, South Africa arguably has the best legislation in the world to help people who are over-indebted – and he encouraged South Africans to use it.
“The biggest mistake people make when finding themselves in difficult situations is waiting for a miracle to happen,” said Roets.
“It is far better to admit that you need help, and the earlier the better.”
Roets added that for many people, the reason they don’t engage in debt review is they don’t want to admit they are in a financial predicament.
“There is nothing wrong with it – nearly half of credit-active South Africans are indebted, and by accepting help, you are being a strong and responsible adult,” said Roets.
“It is just about doing the right thing – you owe it to yourself and your family to handle your challenges head-on.”
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