Cash-strapped consumers urged not to take up loans, to consider debt counselling


12 days ago

CAPE TOWN - Consumers who are in financial distress especially at this traditionally tough time of the year are being urged to consider debt counselling.

Off the back of festive season spending, COVID-19 has also presented some problems for households that found themselves with even less money to spend.

Some already heavily indebted consumers are often tempted to take out loans to make ends meet.

What could be a time where many are still catching their breaths from the festive season spending, acquiring a loan could be seen as the only way out.

With the economy in a fragile state, Debtbusters' Benay Sager is advising people to rather adjust their spending before taking out any more debt.

"So we want consumers to think about what the next 18 to 24 months might look like for them. We want them to think twice about committing their hard-earned money."

In addition to this, skipping payments could be the next approach for some but this will have a negative impact in the long run, making it harder to secure credit.

Sager said that debt counselling could help alleviate the financial pressure for those faced with a dire situation.

"It generally ends up being much more affordable for consumers. It extends the time that it takes to pay back the debt and provides almost immediate cash flow relief for consumers, especially in a month like January."

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This article first appeared on EWN : Cash-strapped consumers urged not to take up loans, to consider debt counselling

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