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The coronavirus pandemic has placed a huge economic burden on South Africans. Thousands have lost their jobs, or have had their incomes cut due to the lockdown restrictions…

With children, parents and other family members depending on them for financial support, women shoulder a huge burden during tough economic times.

“When a crisis like the Covid-19 pandemic hits, women need all the help they can get,” says Carla Oberholzer, debt adviser at DebtSafe.

Recent research results (obtained by DebtSafe during the national lockdown stage/level 4 period) reveal the financial challenges women face when dealing with an unexpected change in circumstances.

Key findings

DebtSafe investigated some of the key findings from the study which investigated how an economic crisis such as the Covid-19 pandemic affected households.

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Ove the 1 240 participants, 77.90% were women. Here’s what they had to say:

  • Women have a large number of dependants: children (38.10%), parents (15.11%), young adults (7.14%), or extended family members & friends (4.55%)
DebtSafe survey results
Image source: DebtSafe survey results
  • Women’s household income numbers mostly reflect between a low R 0 – R 5 000 (28.63%), R 5 000 – R 10 000 (22.90%), R 10 000 – R 15 000 (14.89%) to R 15 000 – R 20 000 (14.50%).
  • Women’s most pressing financial responsibilities include: food (95.22%), water & electricity (63.38%), rent (53.50%), data/internet (30.25%) and medical aid (25.80%).
 DebtSafe survey results
Image source: DebtSafe survey results
  • 12% have debt or credit obligations they need to take care of during an unexpected event or crisis. Their typical/top debts include clothing accounts (49.55%), credit cards (45.95%) or personal loans (38.29%).
  • During a crisis women stop paying/committing to certain financial obligations such as savings/investments (22.93%), retail accounts (21.97%), daycare/school fees (20.06%), credit agreements – for example, a credit card or personal loan (19.11%) and pay television/streaming subscriptions (16.56%).
DebtSafe survey results
Image source: DebtSafe survey results
  • An unforeseen occurrence like the current COVID-19 pandemic or lockdown period specifically harms their finances (75.82%), emotional well-being (54.53%), and stress levels (50.42%).
DebtSafe survey results
Image source: DebtSafe survey results

 

In keeping these financial challenges in mind, Carla Oberholzer offers the following tips for women when they need to deal with unexpected financial blows:

“In honour of #WomensMonth2020, these tips can help women deal with unexpected financial hardship,” says Oberholzer.

1.     Take a step back & take stock of your reality

Women should not be too hard on themselves when having to deal with an unexpected crisis.

They should rather take a step back from any negative emotion and try their best to manage that which they can – taking stock of their financial reality. They can do this by taking a look at their bank statements and really ‘seeing’/taking in all the financial implications that go along with it.

2.     Restructuring finances and setting up an improved/new budget can do wonders

After inspecting their bank statements, women will have a good idea of where they need to cut a few costs to help improve their budget.

They can encourage the entire household to get involved by using less energy-hungry appliances during winter, sticking to grocery lists during shopping outings and putting money that they are currently saving, (for example, fuel costs due to less travelling) to good use (paying off debt or tucking it away in an emergency fund).

After inspecting their bank statements, women will have a good idea of where they need to cut a few costs to help improve their budget.

3.     It is good to renew financial goals and to have a future emergency fund in mind

Change calls for the restructuring of initial financial goals to new ones. Women should try and deal with their current situations by adapting a new outlook regarding their financial picture.

They can refine their goals to suit their situations, for example, the previous goal of saving for a holiday can now become a savings goal for an emergency fund to better prepare and deal with a future financial blow instead.

4.     Dealing with debt in a sustainable manner is VITAL

When facing financial hardship, it is important for women to continue paying off their debt. If they are struggling due to a lack of income, they should try and look for innovative ways to boost their income (which is easier said than done).

Or, do their research well to find a sustainable way to continue ‘servicing’ their credit obligations and lessen debt. They can try the Snowball method (to pay the smallest debt off first and move on to the next), or if they are very diligent, they can try the Avalanche method (to pay their most expensive debt off first instead).

In severe cases where they can’t make ends meet but receive some form of income, they can take a look at a programme called Debt Review to see if that is a viable option to FIX their debt problems.

Managing finances is crucial but not always easy, as seen from the recent COVID-19 pandemic’s chaos caused. Since women have to deal with hardships or uncertain events on top of their personal daily loads, financial tips can help ease their burden.

Happy National Women’s Month 2020 to all.