Tips to avoid over-indebtedness

  • Do a monthly  budget, review it and adjust it regularly;
  • Be honest in how much you can afford in your application for credit. You’re hurting no-one but yourself by pretending you are able to afford the repayments if you can’t;
  • Don’t over extend your budget by being tempted by offers of more credit;
  • Be honest with your spouse or partner or parents about your financial situation and discuss your needs;
  • Do pay cash where possible by postponing buying and saving to buy cash instead;
  • Do pay your creditors on time as skipping payments or paying short will affect your credit bureau record negatively;
  • Do get help as soon as you think you are in trouble as hiding away will just make your situation worse;
  • Don’t ignore your creditors and make sure your contact details are always up to date;
  • Don’t be afraid to say No if you can’t afford it;
  • Make sure you understand the terms of loan. You have the right to receive simple information from your credit provider in a language of your choice
  • Keep the bigger picture in mind. You may think that taking out another small loan won’t hurt your finances, but when you consider all your costs and expenses, it may just tip you into over-indebtedness. Consider all your costs and expenses before being tempted to take on more credit.
  • Keep the possibility of the impact of an interest rate hike, price increases and emergencies in mind and how these will impact on your ability to repay your debts.
  • Don’t stand guarantor or surety for ANYONE unless you understand the implications and you are sure you will be able to take over the repayments; and
  • Don’t be afraid when you are struggling to repay – help is available