South Africa, according to research conducted by the World Bank, holds the dubious honour of being the biggest borrowers in the world…
In fact, it was shown that more South Africans had loans than jobs. This inclination towards going into debt, fuelled by high unemployment and a historically lax credit lending industry has eroded not only the personal financial capacity of millions of South Africans, it has also had a secondary more insidious influence.
The impact of debt extends beyond just strained personal finances, manifesting in both emotional and psychological impacts that negatively affects those who are in debt. While different people process their debt obligations differently; some crumbling at the thought of being a few hundred Rands in debt, others feeling quite content even when staring down the barrel at debts running into the hundreds of thousands of Rands, there is no doubt that debt will impact your quality of life.
Debt is the slavery of the free and its chains are not metal but mental, harming relationships, shrinking ambition and diminishing self-confidence. It could therefor probably be argued that debt is as much about money than about personal well-being.
Financial wellness assistance
Kudough, a company dedicated to improving their clients’ financial wellness allows you to view your credit report based on data gathered from the 4 leading credit bureaus in South Africa: TransUnion, Compuscan, XDS and Experian.
It is important to compare your report from all leading bureaus as some credit providers or banks can list data with one bureau and not another and you could end up being oblivious to what is on and what is not on your record. One bank could use the first bureau, whereas another bank uses the second or third bureaus.
Having a 360-degree view of your credit profile across all bureaus is therefore key. Recent statistics have shown that 1 out of 5 people find incorrect information on their reports and might be getting higher interest rates or declined for loans for not being aware of faulty information. There is an estimated 87% of South Africans with errors on their credit reports. Last year 17% of people who pulled their credit reports and found errors on them challenged the wrong information and 2 thirds were resolved in favour of the consumer.
Reviewing data on your report can also prevent you from being a victim to identity theft
Legal advice and ID theft cover are also part of the financial toolkit from Kudough. The journey of improving your finances start with regularly reviewing your report and from there on out, Kudough does the heavy lifting – they identify debt improvement goals for you that they are so confident will work and help you succeed, that they offer a 100% money back guarantee if you don’t.
They will also help you identify potential savings from your existing credit agreements or your day to day spend. If you qualify for early debt settlement, they have the partners that can get you massive discounts.
Following personal goals set out for you will also enable you to lower your debt, increase your rating, get better interest rates on loans, help you qualify for home or vehicle finance and empower you to save for emergencies, retirement, education and even holidays .
To top it all off, Kudough offers their clients savings opportunities to reward their
growth and progress. Top end brands in leisure and travel, sports, food and beverages, luxury items, specialist services, retail offers and many more are available to you from the moment you join Kudough.
5 ways in which debt can negatively affect you:
Anxiety; shame; panic; physical illness; hopelessness. Dealing with these negative emotional and mental effects of debt is not only necessary, it is essential.
It is wise to have a plan for dealing with the stressors associated with debt. Most important is realising and accepting that you do not have to suffer alone. Besides family and friends, there are numerous organisations and professional counsellors able to assist you and help ensure that your recovery from a debilitating debt event is a growing rather than an incapacitating experience.
While the importance of getting professional financial assistance; to help you put together a work-able budget, deal with debts, identify areas for greater financial control and improving your credit score cannot be overstated it is equally important to also put a plan in place to look after yourself. Because focusing on your mental health will directly improve your financial health. Guaranteed.