Dec 2021 Edition

Assess your finances

Written by Allison Cooper

As many people spend more money than they can afford to pay back over the festive season, the Credit Ombud has provided some credit advice to help individuals make better financial decisions. 

According to Kabelo Teme, the Communications Liaison Officer at the Credit Ombud, when a person applies for credit, there are guidelines that the credit provider must follow in terms of the National Credit Act. This is to ensure that people will be able to pay back the money or pay off the goods.

“Getting stuck in a debt trap causes frustration that may lead to depression, because you feel that debt has overpowered you and you no longer have any control. We want to teach consumers to take that control back. A sure way to do this is to do a self-evaluation of your financial state,” says Teme.

She explains that consumers should look at their finances before they apply for credit.

“Credit providers are required to do an affordability assessment. You have to do a realistic budget that includes necessary expenses and everything else on which you spend money. Get a three-month bank statement and see how and where you spend your money.”

Teme says consumers should also ask themselves if they really need or only want an item. “At times, what we want can wait. Save up for an item or lay-bye it. If you need to draw up a list of pros and cons, then do so. Do not apply for credit if you don’t have a plan to pay it back.”

Consumers should also be aware of interest and added credit fees, says Teme.

“Before you put your signature on the dotted line, know the total cost of the credit and the total monthly instalment.”

She says consumers must also be given a pre-agreement statement and quote before they sign a credit agreement.

“You have five business days to consider the offer, and you don’t have to accept it.”

It’s also important for consumers to check their profile at the Credit Bureau. “You can do this for free, once every 12 months, and can dispute any incorrect or outdated information,” says Teme.

How to check your credit profile?

The Credit Ombuds advises consumer to contact the major credit bureaux for information on credit profiles. Their contact details are as follows;

The Credit Ombud provides free assistance and advice for all credit bureau and credit agreement-related matters. For assistance, call 0861 662 837, send an SMS to 44786 (free), email or visit

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