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Debt is About More than Money

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, fueled 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 therefore probably be argued that debt is as much about money than about personal well-being.

It is important to compare your report from all leading bureaus (TransUnion, Vericred, XDS and Experian.) 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.

The Mental & Emotional Chains of Debt .Let’s first look at 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 realizing and accepting that you do not have to suffer alone. Besides family and friends, there are numerous organisations and professional counselors 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.

Our Passion here at the Pioneer Group is to give you the assistance you need to successfully and efficiently manage your debt so that you can open up the door of opportunities credit can bring. Get in touch with us directly for counselling, or make use of our debt calculator for more information.


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