{"id":861712,"date":"2026-06-06T14:00:00","date_gmt":"2026-06-06T12:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=861712"},"modified":"2026-06-05T14:05:04","modified_gmt":"2026-06-05T12:05:04","slug":"people-earning-over-r600000-a-year-are-in-deep-trouble-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/lifestyle\/861712\/people-earning-over-r600000-a-year-are-in-deep-trouble-in-south-africa\/","title":{"rendered":"People earning over R600,000 a year are in deep trouble in South Africa"},"content":{"rendered":"\n

South Africans earning more than R50,000 a month, or over R600,000 a year, are facing mounting financial pressure despite signs that overall debt stress has eased slightly across the country.<\/p>\n\n\n\n

This is according to the latest DebtBusters Debt Index for the first quarter of 2026, which showed that a surprising income group is under severe pressure. <\/p>\n\n\n\n

This is because, while lower interest rates and access to retirement savings through the two-pot system offered temporary relief, many households remain under severe strain.<\/p>\n\n\n\n

DebtBusters executive head Benay Sager said the nature of financial pressure in South Africa has shifted away from traditional debt stress and is increasingly tied to the rising cost of living.<\/p>\n\n\n\n

\u201cI think the stress from debt is a little bit less than it was, which is great news. This is partly aided by the fact that incomes have grown a little bit, and we are probably also accessing the two-pot withdrawals,\u201d Sager said.<\/p>\n\n\n\n

However, he warned that inflation-linked expenses such as electricity, municipal rates, and fuel are placing households under growing pressure.<\/p>\n\n\n\n

Consumers who applied for debt counselling during the quarter needed 64% of their take-home pay to service debt.<\/p>\n\n\n\n

Although this is lower than the peak of 73% recorded in the first quarter of 2021, it remains extremely high.<\/p>\n\n\n\n

The situation is particularly difficult for higher-income earners. For South Africans taking home more than R50,000 a month, debt repayments now consume 101% of their net income.<\/p>\n\n\n\n

Additionally, the debt-to-income ratio of these income earners has climbed to 303%, the highest of all income groups.<\/p>\n\n\n\n

According to the report, unsecured debt among top earners has surged by 99% since 2021, far outpacing inflation of 27% and salary growth of just 6% for this group.<\/p>\n\n\n\n

Sager said many higher earners are still recovering from the financial effects of the Covid-19 pandemic.<\/p>\n\n\n\n

\u201cPost-Covid, everyone had to take significant pay cuts. For many income groups, we just barely eclipsed 2019 and 2020 income levels. It\u2019s taken us five years,\u201d he said.<\/p>\n\n\n\n

Living expenses are a killer <\/h2>\n\n\n
\n
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DebtBusters executive head Benay Sager <\/em><\/figcaption><\/figure><\/div>\n\n\n

He added that many wealthier South Africans are carrying the financial burden of supporting extended family members and friends, while also being among the few able to access formal credit.<\/p>\n\n\n\n

As a result, debt levels among higher earners have ballooned. DebtBusters found that 96% of debt counselling applicants in this income category now have personal loans, while 61% have payday or one-month loans, both record highs.<\/p>\n\n\n\n

The average number of credit agreements per applicant also climbed to 8.5 during the quarter, the highest level since 2017, highlighting growing reliance on multiple lenders.<\/p>\n\n\n\n

While higher earners are battling rising debt, lower-income households remain under intense pressure from basic living costs.<\/p>\n\n\n\n

South Africans earning less than R10,000 a month are spending around 40% of their income on food and related expenses. Electricity costs have become a major burden across all income groups.<\/p>\n\n\n\n

\u201cIn five years, the electricity tariffs have almost doubled. The expense is so high when it comes to electricity, it\u2019s a major input cost,\u201d Sager said. <\/p>\n\n\n\n

Sager said the first quarter figures may also understate the pressure households are currently facing because they do not yet reflect more recent increases in petrol and electricity prices.<\/p>\n\n\n\n

He also warned that consumers should brace for the possibility of further interest rate hikes if inflationary pressures continue to rise.<\/p>\n\n\n\n

He urged South Africans to focus on budgeting, reducing expenses, increasing income streams, and renegotiating debt where possible.<\/p>\n\n\n\n

\u201cThe first place to start is to think about things you can do for your income, for your expenses, and for your debts. Those three things are always important,\u201d Sager said. <\/p>\n","protected":false},"excerpt":{"rendered":"

South Africans earning more than R50,000 a month, or over R600,000 a year, are in distress. <\/p>\n","protected":false},"author":92,"featured_media":862307,"comment_status":"open","ping_status":"","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9876],"tags":[16894,853],"class_list":["post-861712","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lifestyle","tag-debt-busters","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/861712","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=861712"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/861712\/revisions"}],"predecessor-version":[{"id":861718,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/861712\/revisions\/861718"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/862307"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=861712"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=861712"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=861712"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}