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How to stay debt free - 6 tips

Dec 21 2012 17:01
debt

SA consumers are drowning in debt.

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Johannesburg - Too many consumers are caught up in the debt trap and South Africans are urged to steer clear of wasting their hard-earned cash ahead of the New Year.

"2012 had been a tough year and many households have felt the financial pressure. To avoid intensifying or even relieving pressure, it is vital that consumers budget wisely this festive season to prevent starting  2013 with unnecessary bills and debt," said Henry van Deventer of financial advisory firm acsis.

"Debt is often a continually-worsening spiral that consumers cannot control and then get stuck in. Once in it, escaping the vicious cycle of debt can be daunting. It is thus better to avoid the situation completely.”

Jason Bernic, financial planning coach at acsis offers six budgeting tips to limit or even stay out of debt:

1. Your lifestyles should rely on your salary only. If you receive a bonus, enjoy some of it, but save most of it;
2. Spend money you have, not credit you have;
3. Increase your debt repayments in line with your salary increase;
4. Focus on family activities instead of going to the mall;
5. Avoid temptation and resist ‘sale’ signs – ask yourself whether you really need it;
6. Budget for next year’s expenses e.g. school fees. Also, where possible, pay annual premiums – you’ll often find that you get a significant discount.


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