DEBT IS CRIPPLING SOUTH AFRICAN CONSUMERS!

According to The Experian Consumer Default Index (CDIx), which measures the rolling default behavior of South African consumers with Home Loans, Vehicle Loan, Personal Loan, Credit Card, and Retail Loan accounts, as of the end of 2023, South African households had close to R2 trillion in outstanding debt, with R25.8 billion being in default.

Something concerning is happening—Experian says that mid-to-high-affluence consumers, who normally qualify for high-end credit products and home loans, are finding it increasingly difficult to repay debt and continue to use their credit cards extensively.

There has also been a surge in Debt Review applications in South Africa, as higher-affluence consumer groups are increasingly struggling to honor their debt commitments.

In many instances, despite various avenues available where consumers can seek assistance, households are avoiding it, leaving debt to spiral out of control.

Collectively, South African households owed a mind-boggling R305bn in arrears to local municipalities as of December 2022 (reported by the National Treasury). This greatly impacts service delivery and contributes to major challenges in maintenance and infrastructure in our country.

FNB estimates that it takes an average of five days for a middle-income consumer to spend up to 80% of their monthly salary.

From the same report, we see that the average middle-income SA consumer, earning between R180 000 – R500 000 per annum, survives on 20% of their monthly salary for more than 20 days in a month. In addition, salaried middle-income consumers with secured and unsecured credit spend, on average, 30% of their income on unsecured credit and 35% on secured credit.

How are you with your money, do you follow good money habits?

[thabisomollo]

70% of my net salary goes straight to debt repayment and this is a consequence of wanting soft life. I regret the day i was told i qualify and not assessing if i afford.

[bulelanibaqwa]

I was honest with myself and started to pay down debt and stop blaming the economy.

It's a tough journey, but I will make it

[gwazaluthando]

Trying to look rich will have you drowning under consumer debt, a wise man once said " you should rather go broke buying assets with your salary instead of buying status symbols to look rich"

[odwasiswana]

5 days is too long. It vanishes within 3 days.

[RandomSouthAfricanMan]

Everyone I know is currently reassessing their lifestyles because their money is not going as far as it used to anymore. Things are bad.

[tbangbangsa]

Anytime I leave my house to go to the shop or mall it feels like I'm the only one broke due to how full it always is

[pitsotsibs]

Graphics would have made this already awesome pop even more! Consider it Zimasa!

[mandlenkosimafu]

The whole month shame. I live in the rural areas git little to spend on

[phiwazulu]

Just subscribed and liked. This is the financial content I was looking for!

[phumlanindlovu]

I GOT PAID TODAY AND I CAN FEEL BROKENNESS LAIRING, AFTER PAYING MY RESPONSIBILITIES AND I HAVENT EVEN PAID RENT😅💔

[Tshepo]

Example of many South African men:
Uber driver hired by another person, Will buy a golf shirt and jean that is 90 % of his salary and go out partying while having kids and wife, and say "Re leboga mmele".

[ZiphozonkeNcanana]

Thank you for your informative content, brother.

[bonganisibiya]

5 days and salary is gone for most😮. That bringing a different meaning to paycheck to paycheck 😳

[kdzmatrrmat]

Blaming someone else wont change your situation, live within your means and stay there!!!!

[its_bobhermanus]

Debt is enivitable in an economy run by a government that hates us. These are scary stats bro, everyone is in or going to be in debt inevitably, especially our working class. We also have an economy that loves offering debt knowing you can't afford it - that's hate.

[KiingM]

I wish more people cared about this stuff

[griffinrunaway]

It's lasts for a day brah, when i bought my bond, it was 6K now it's 8.5K the increase is heavy

[madein]

Mine is already finished before it comes to me. I have to steal from myself to enjoy R200

[nonhlanhlangwenya]

Hyper inflation, repo rate was increased about 5 times last year. Consumer Price index is also at an all time high, as well as unemployment rate. Rand lost value. Peoples income remained stagnant. Therefore purchasing power reduces. The scale is too big for some people to suggest that people are living beyond their means.

My opinion anyway…

[thabisohitchdladla]

There's also loan sharks that we need to pay, no credit checks done there 😅, but yah they are dangerous (40 to 50 % interest on a monthly basis) and they don't like payment plans :( .