Ease your financial pressures by understanding and managing your debts

We all do it sometimes. We think that our salary is more than it actually is because we forget about deductions. This means we have a tendency to overestimate how much we earn per month.

To correct this view, log into your Standard Bank profile on the App or Internet Banking and download your three month statement. While looking at your statement, total up all of the items under the “Deposit” column or the amounts in green. The total over each month is your actual income that you have available for you to spend.

The Golden Rule is never spend more than you earn!

There are three broad expense categories: living expenses, luxury expenses and debt repayments. 

Living expenses
Living expenses are basic items that you can’t live without, like a roof over your head and food to survive. However, some living expenses may be relative from one person to the next depending on your lifestyle. You need to monitor how much you spend on your living expenses to see if you can tighten your spending.

How can you reduce your living expenses?

• Look for specials or bulk buys when you shop for groceries. Many retailers run specials during the month which are printed in pamphlets or posted on their websites.
• Take advantage of loyalty and rewards programs. We offer you Ucount Points for every rand you spend at a partner retailer. You can accumulate these points and buy goods from various retailers or our Ucount mall.

Luxury expenses
These are non-essential items that you can live without but instead, upgrade your lifestyle, such as a holiday, eating out, buying expensive goods or splurging on entertainment…

The Golden Rule is to only incur luxury expenses after your living and debt expenses are paid.

When you enter into debt, you agree to make repayments back to the credit provider. These repayments can sometimes be costly, depending on the interest rates that you are charged. The Golden Rule is to always keep your debt repayments as low as possible and to always try to pay up the highest interest rate debts faster.

When you enter into any credit agreement, you receive either goods, services or even money, which you undertake to pay back over a period of time. In exchange for your credit provider advancing you these goods, services or funds, you are charged interest. Interest can be thought of the amount you repay to your credit provider for them taking the risk of lending to you and for also waiting for the full repayment.  Generally, the longer the term of the loan, the lower the interest rate but in the long run, you end up paying more. Be mindful of this as many of us forget that over the period of a loan, the total amount repaid is more than the money borrowed.

The easiest way to manage your expenses is to set up a budget and to strictly keep to it. To learn more about budgeting, visit our budgeting tips page.

Another easy way to manage your expenses and to also make sure you do not miss any debt repayments, is to have a debit order loaded onto your transactional account. With a debit order, you never have to worry about forgetting to pay your debts. To find out more about debit orders, visit our debit order page.

We understand and can help. If you are not yet in arrears, visit our Distressed Customers Solutions page. If you are already in arrears, visit our Arrears Management page.