Reducing expenses

Many South Africans have high debt repayments each month. This can lead to struggling to meet other expenses and needing to borrow more money to make ends meet.

Sometimes our spending habits lead to borrowing money to buy things we don’t really need. Saving up to get things we want instead of using debt helps keep us on track to reach our goals. Buying things with debt instead of savings is expensive because the price of having something now rather than later is interest charges. It’s a good idea to check the total cost of what you’re buying including interest and ask yourself if that is the price you’re willing to pay and if you can afford it.

This approach leads to more informed choices and is one of the ways to keep spending less than you earn.

If you already have debt or if you have too much debt, pay your most expensive debt (the debt with the highest interest rate) as quickly as you can. Pay a bit more than the minimum repayment amount and you’ll soon see the amount you owe getting smaller.

Keep in mind that people who have a budget and stick to it have a better chance of reaching their goals.

Get started with your budget

  1. Your income (the money you earn from working (salary or wages) plus any other income you get).
  2. Your total expenses - regular (daily, weekly or monthly) expenses including debt repayments and your less frequent expenses (those that happen every now and then or maybe once a year). Add all your expenses to get your total expenses.
  3. The difference between your income and your total expenses.

starting a new job

To have enough to live on, your expenses must be less than your income. If this is not the case, look at where you can reduce expenses or ways to increase your income.

The bigger the difference between your income and your expenses, the more you can save for your future self and the more chance you have of reaching your goals.

If you’re interested in more information or worry that you might be in financial difficulty and want to use our checklist to assess your situation, find out more here.