With many consumers starting out the year with holiday debt and tough times coming up, now is the time to review your finances and start 2016 on a sound financial footing.
“This year is going to be tough on South African consumers due to the volatile rand, increased living expenses, including the anticipated increases in the cost of electricity, water and food, so the earlier you get on top of your finances, the better it will be in the long run,” says Chris Labuschagne, CEO of FNB Credit Card.
Take responsibility for your money
It may be tempting to hide your head in the sand says Labuschagne. This is especially true after the holiday season. “But, never pay debt with debt, while it is possibly easier to apply for another short term loan or increase your credit limit than it is to take responsibility for your spending, this will quickly result in serious financial difficulties,” says Labuschagne.
Consumers need to not only consider the implications of overspending at the holiday season, but also to realise that the current economic climate is mostly likely going to result in higher interest rates as well as pushing up the price of goods. This means that debt will become more expensive to pay off.
“The need to spend wisely is a reality, due to the tough economic climate, companies may cut down or not pay out bonuses,” warns Labuschagne. “Consumers cannot rely on additional incentives to pay off their debt.”
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