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Debt Management

Get Financially Fit

Are you generally left with more month than money? Making your money last until the end of the month can seem like an impossible task, but there are ways to reduce your debt and become financially fit.

Your monthly spending could be for things like: paying off your house, car, or personal loan - but you could also be spending on travel and entertainment – which can lead to overspending. This type of overspending prevents you from buying basic necessities and restricts you from participating in social activities, which could lead to high stress levels and/or depression. The great news is that there are steps that can make you more financial savvy and ensure that you spend your money wisely.

Take control of your finances now! If you are able to reduce your spending, you may be able to have more money available at the end of each month. Whether you actually decide to sell your house, pay off your debt quicker or reduce the amount of actual spending each month, we have the information and financial options to set you on the right path.

What can you do immediately to take control?
  • Be committed to paying off your debt
  • Don’t spend more than you earn
  • Don’t take up any further loans
What are the easiest steps to take control of your finances?

Draw up a budget and track your expenditure!

  • Determine your income: including salary, freelance work, rent, investments, tax refunds and even your cash-back rewards
  • Draw up a list of all your day-to-day, monthly and yearly expenses
  • Don’t forget your car licence renewal, TV licence, rates and post box renewals
  • Plan for unexpected costs – such as flat tyres, school trips and traffic fines - and start building an emergency fund
  • Keep track of all that you’re spending against your planned budget
What are the next steps you can take to help in the short term?

It starts with a phone call!

  • Know your credit rating. You are entitled to one free credit check a year, so take advantage and call your credit bureau to check your credit status and financial reputation
  • Review your bank statement and confirm that all debit orders are correct. If you think values are wrong, make some phone calls and find out more. Remember: there is nothing wrong with asking questions, and unless you ask, you will never know if the costs are legitimate
  • Call your insurer and make sure that your car is insured for the correct book value. This should be done once a year.
  • Speak to your cellphone provider about messaging bundles and reduced call rates, so you pay reduced charges
  • Call your bank to make sure you have the best all-inclusive fee option on your accounts so that you pay one monthly fee and not for every transaction you do
  • Use the balance transfer option to consolidate your credit card at a lower interest rate and commit to paying off your accounts as soon as possible
  • Call your bank and request that they reduce your credit card and overdraft limit
  • You can start small by saving any extra money that you have at the end of the month. The goal is to keep your money safe so that it is available when you need it
  • Review the value-add services on all your accounts so that you know what that R3 or R4 is for on every one of your statements. If you are not sure what the cost is for, phone and ask - if you don’t need it, cancel it because all these small costs add up!
  • Want to know exactly what you will spend on your home loan every month? You could phone your bank and ask about fixing your home loan interest rate. This means that if the prime rate increases, your home loan instalment won’t increase unexpectedly
What are the next steps you can take to help in the medium term?

Cut down on unnecessary expenses and reduce your debt

  • Pay the amount agreed to on each account on time and each month. Whenever possible, pay in a bit more on the card that charges the highest interest rate. List your cards according to amount owed, and pay off the smallest account first. Once that account is zeroed, you can use this money to pay off the next account even more quickly
  • Call your bank and request a quote to extend the term of your existing loans or a lower interest rate
  • It is easy to get multiple quotes for insurance, so shop around. If your profile has changed in any way – for example, you are older, married or haven’t been in an accident in the last year, this may influence the amount you pay for your insurance
  • Review your medical aid plan – there may be many extra benefits that you might not be aware of. Maybe you can use your medical aid savings account for more health care purchases or change your plan to suit your lifestyle
  • Pay extra into your home loan every month. Even an amount as small as R100 can have a significant impact on the amount of interest you will pay in the long term
What are the next steps you can take to help in the long term?

Controlling your debt? Now focus on your financial future

  • Start investing any money you won’t need for at least seven years. The goal here is to have your account grow over time to build a retirement fund or build a new house
  • If you have children and want to invest in their future, ensure that you put money away for them to use to pay for university or a new car
  • When investing in a home, buy a house that you can really afford, and over time it will rise in value. If you currently have a house with a bond you can’t afford, consider selling your house
  • Lower your monthly repayments by consolidating your debt with your home loan
  • Invest in yourself and increase your earning power. Look at what people with your skills are earning in the market, and benchmark your earnings against this. Maybe it is time to apply for a new job or take a course to increase your skills. If you have spare time, find a part time job or arrange to work some overtime if moving to a new job is not an option.

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We will contact you with more information on how to effectively manage the debt that you have with us.

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