South Africa as a country is a remarkable, beautiful and diverse place. However, as a people we have an extremely low financial IQ. Our society, like a lot of the Western World, is driven by consumerism.
The lines have been blurred between “want” and “need” and this, coupled with a poor understanding of financial acumen, has left large portions of the population struggling with debt.
The depth of our credit based society was recently best illustrated by the One Rand Man – an initiative done by Sanlam to bring awareness to the growing problem of overspending, reliance on credit and a lack of solid financial planning. In South Africa less than 5% of the population have any form of savings, while almost everyone is living in some form of debt. The lack of understanding of fundamentals like interest rate, compound interest, budgeting and investing, to name a few, can only lead to long term financial issues.
By living paycheque to paycheque, often supplemented by credit cards, store credit and other forms of debt, most South Africans have little to no money to put towards their futures. The mentality of today is to worry about the “now”, rather than to consider the future.
Below you’ll find links to our latest series on Credit. Every article was written in a form that is easy to understand and also with the purpose to help educate you on Credit, its various forms and pitfalls.
1.) 5 Ways to Fix Your Credit Score
2.) 5 Myths about Credit Reports
•Credit scores are somewhat mythical beasts – no one is quite sure what affects it and what doesn’t
•Look at the 5 major “myths” behind credit scores, certain weird things that affect them (include Debt Administration facts/solvency facts)
3.) Credit – The Double Edged Sword
•A more in depth look at credit and how it works
•Why we need credit, how it affects everyday life
•How credit can both help and harm
•Different types of credit – good and bad (explain for the layman)
4.) Store Credit Conundrum
•Everyone’s favorite type of trap – buying on “credit” for a cheap amount over 24 months
•Explain how that affects a purchase, the interest rate, how that compound affects you (brief explanation of compound interest in form of easy to understand example)
5.) 25 and Under – How to Positively Grow Your Credit Report
•Something I wish I had read when I was 18 – a proper explanation about what credit rating is and how to grow it in a way that doesn’t damage your financial wellbeing
•Opportunity for external links here – bank sites that have credit cards you need to load with cash each time you use it etc.
6.) Need Cash Now? Credit and Quick Loans
A look at quick loans – general breakdown of how they work, where they can fill financial void, how to use them (lets be positive here)
7.) Online Loans – Credit Where Credit’s due
We hope you enjoy reading these carefully thought out pieces as much as we enjoyed writing them.
If you have any questions or suggestions for topics that you think we should cover in the future, please don’t hesitate to send an email to email@example.com
Check out more of our personal finance articles