Should I pay off my debt first or start an emergency savings fund?

Simple moves that help you do both

Pay yourself first

Set a debit order on payday, even if it’s just R100 or R200. Treat it like you do your rent or groceries: non-negotiable. You’ll barely notice this amount leaving your account, but over time, it adds up to real money when you need it.

Focus on high-interest debt

Not all debt is equal. A home loan? Lower interest rates on an asset that can grow in value, and provides shelter. Credit cards, store accounts, and personal loans? Higher interest for things that lose value or don't last. If you buy groceries on credit, they're gone in a week, but you're still paying them off months later. Tackle high-interest debt first.

Try the debt snowball method

Start with your smallest debt, while keeping up the minimum payments on everything else. Once that’s out of the way, take the money you were paying and add it to the next debt. It’s a simple way to build momentum and actually see your progress.

Here's what that could look like:

• Store account: R1,500 (pay R300/month) 
• Credit card: R8,000 (pay R500/month minimum)
• Personal loan: R12,000 (pay R600/month minimum)

Allocate any extra money to the R1,500 store account first, while paying off the minimum amounts on the others. Once the store account is paid off, add the R300/month to your credit card payment – now you're paying R800/month. When the credit card is cleared, roll that R800/month into your personal loan payment. Now you're paying R1,400/month on your biggest debt.

Build your emergency fund step-by-step

Once you’re ready to build your emergency savings, start with a plan.

Set a target

Start with a goal that feels doable – maybe it’s R1,000, then R5,000, then R10,000. Although the big goal is to have three to six months’ salary saved, don’t let that stop you from starting with R100.

Start now

Even if money feels tight, there are ways to free up cash without changing your lifestyle dramatically.

• Rethink your phone contract. You don't need to upgrade every two or three years. Switch to a SIM-only contract once your device is paid off. If you save around R200 a month, that’s R2,400 a year straight into your emergency fund.
• Make loyalty programmes work harder. Put your UCount Rewards towards groceries, fuel, or electricity instead of treating yourself. It's not as exciting as a restaurant voucher, but it frees up real cash for saving.
• Sell what you don't use. That extra kettle, the clothes you never wear, or the old phone gathering dust? List them on Facebook Marketplace, Yaga, or Gumtree. Even R500 here and there adds up.

Then tackle the basics:

• Shop around for cheaper insurance. 
• Cut your water and electricity usage.
• Stick to a grocery list to avoid impulse buys.
• Cook at home instead of eating out.
• Cancel subscriptions you don’t use.

Pick the right account

If you dip into savings easily, use a Notice Deposit account, which needs 7 to 32 days’ notice before withdrawing. If you're disciplined and want quick access in a real emergency, a flexible account like SaveUp works well. You can access your funds anytime without penalties, earn up to 6.55% interest, and pay no monthly fees.

Here's what consistent saving looks like:

Save R200 a month at 6.55% interest and you’ll have R2,400 after a year, plus about R80 in interest. In two years, you'll have over R5,000 – enough to handle most emergencies without panic.