Resist reckless Xmas spending

Johannesburg - Reckless Christmas spending will cause untold financial stress into the new year for consumers, the National Credit Regulator warned on Tuesday.

People needed to keep an accurate tally on exactly what they would spend at Christmas, senior manager of education and strategy Peter Setou said in a statement.

"Rather start formulating a budget now. All those little purchases can add up to one big debt burden."

Consumers should not be tempted, nor should they give way to social pressures to spend.

"Putting down on paper the realities of income and daily living expenses will concentrate the mind on exactly what is available for gifts, travel and entertainment over this period. It is a reality check for many consumers in denial."

Bonuses and thirteenth cheques should rather be spent on repaying debt, or saved. Another good plan was to be proactive and to double-up on regular payments such as mortgage or rent, lights and water to create breathing space after the holidays for new year costs such as school fees and uniforms.

Setou encouraged consumers to regularly revisit their spending patterns.

"Become more effective at comparing prices... ignore tempting product and credit advertisements, shut yourself off from those deceivingly expensive 'no-deposit' offers, and be a disciplined borrower, saver and spender."

While consumers have had some relief this year from interest rate cuts, these should not be seen as opportunities to return to reckless spending habits.

- Sapa