Consumers affected by debt
Last week we saw the petrol price increase to above R16 per litre for the first time in South Africa – the biggest fuel hike in our country’s history. The Automobile Association also noted that toll fees have risen between 6% and 7%.
So where does that leave consumers, besides in a flat panic with more debt?
David ‘O Brien from Meerkat said; "The South African Consumer is under pressure from the increasing petrol price. President Trump’s policies are impacting the global oil price, and ex-President Zuma’s tenure has damaged the Rand. The cost of transport is already a major component of household budgets, and specifically a major element of the cost of receiving medical treatment.”
‘O Brien added; “However, the trickle-down effects of the increased petrol price on the cost of food is still to come and will add further hardship."
The majority of South Africans have already been making considerable spending and lifestyle changes over the past few years – and often it feels that there’s no real relief in sight. Increase after increase in prices is putting many consumers into more debt because, unfortunately, the only relief usually comes from short-term debt. Although this may provide a sense of financial security at the time, short-term debt can have long term consequences that can be very hard to resolve.
DID YOU KNOW: In South Africa, there are over 25 million credit-active consumers, of which over 10 million are in arrears. This means that more than 40% of consumers with debt struggle to pay back some of their debts. And with the recent petrol price increase, this could force you into even more debt.
So… buckle up and budget!
South Africans need to learn to budget better. By missing loan repayments, you affect your credit score and also get penalised by high fees and unnecessary charges. A decreasing credit score will also affect your chances of taking out more credit in the future and could even affect your job search.
To help balance the increase in transport costs, try finding ways to save money when it comes to transport options. Instead of driving to work and back by yourself, try catch a lift with someone in the office. This way, you can split the petrol cost. Also look at using public transport. You could also save petrol by driving better and by making sure you take more efficient routes on the daily. Try and travel off-peak, as idling in traffic wastes a lot of fuel. Staying within the speed limit and keeping your tyres in check can also help you get further financially by being more fuel savvy.
Here’s 10 more fuel-saving hacks to help you get more fuel for your buck:
1. Revving means more rands – try not to over rev your car.
2. Drive in high gear rather than driving in low gear.
3.Putting foot means more fuel – don’t speed!
4. Service your car and keep your service book in check!
5. Shop around for cheaper fuel options.
6. Minimise the use of the aircon.
7. Slow and steady –say goodbye to aggressive driving for the sake of saving.
8. Don’t be too hard on your breaks.
9. Get more bang for your buck by filling up in the morning, rather than late afternoon or evening.
10. Green means go! Learn the timing of your local robots and plan your trip accordingly.
Get your debt in check
Have you hit a roadblock when it comes to debt? If you find yourself struggling to budget and pay back your debt, you need to consult a debt counsellor. Contact Meerkat today and start your road to a debt free life.