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Cape Town - With petrol and diesel costs going up, cash-strapped consumers will be facing a difficult time to make ends meet.
2016 has been very tough so far for consumers with various increases in the cost of living. These include interest rate hikes, the electricity costs raising and petrol price increases.
The cost of a litre of fuel will shoot up by 98 cents a litre (c/l) as of midnight on Tuesday.
Petrol 95 (both ULP & LRP) will increase by 88c a litre and 93 (both ULP & LRP) will increase by 86c a litre.
Diesel (0.05% sulphur) will increase by 96c/l and diesel (0.005% sulphur) will increase by 98c/l. Illuminating paraffin will increase by 76c/l and Liquefied Petroleum Gas (LPG) will increase by 110c per kilogram.The petrol price includes a fuel levy rise of 30c/l to R2.85c/l and a R2.70c/l rise for diesel as announced by Finance Minister Pravin Gordhan in his February budget.
Debt expert Neil Roets told Fin24 the impact of the fuel price increases on consumers are twofold.
"Not only are consumers going to feel the pinch in their pockets directly each time they fill up their fuel tanks, but also indirectly through the rising cost of goods," he explained.
"All goods, including food and consumables, are transported by road, which means that their transport costs are going to increase drastically, the impact of which will be transferred to consumers."
Roets said it is imperative for consumers to be aware of their financial situation. He recommended that they start by setting up a budget to get a full understanding of their financial position.
"Here they must take into account their income, deductions and necessary living expenses, to establish what they have remaining to pay towards their debt.
"This is also where they can see where they might be able to make cuts where necessary. If at this point they cannot meet their monthly debt commitments, they are over-indebted."
Almost half of all credit active consumers are considered to be over-indebted, whereby they are behind with their debt repayments by three or more months.
According to Roets, debt counselling remains the best way for consumers to deal with their debt burden effectively, by reducing their repayments and extending their repayment terms.
Roets cautioned that the outlook for the rest of the year is not looking much better with expected further interest rate increases.
"Consumers must not wait until it's too late. Seek help from a debt counsellor as soon as you experience financial difficulties."
