South Africans do not need the ongoing war between Russia and Ukraine, according to Sebastien Alexanderson, CEO of National Debt Advisors, who said the sanction imposed on Russia will come at a cost.
“Global food supply shortages are looming, price inflation is inevitable, and the price of oil is skyrocketing,” said Alexanderson.
“With this hyperinflation, there isn’t a single South African who isn’t going to feel the pinch coming our way. The price of getting to and from work is about to increase and the cost of our everyday staples, especially bread given the ban on wheat imports from Russia and Ukraine, will also be going up.”
He added: “People living on the breadline will be hurt the most. While the hope is that war will come to an end soon, and will not escalate further, the situation is evolving every day and we need to prepare ourselves for this uncertainty financially, in a sustainable way.”
He shared three tips to avoid increasing your debt during these tough times.
For those feeling the pinch for the first time to the point where you might or are falling behind on your payments, it is important to know your rights as a consumer in case you get into financial constraints:
- If your job is affected for any reason and you are retrenched, it’s important to get evidence of retrenchment and to contact your creditors immediately as you may and most likely will have some type of credit insurance tied to your credit card or loan.
If you are curious to know more, just go into any of your credit card or loan payments and look at the breakdown on the statement. If you see the word credit life or insurance, you can request a copy of the policy document and see what it covers. In some cases it will cover you for accidents, dreaded disease and death.
However, if you miss too many payments before trying to activate the policy, you may find it has lapsed and you can no longer claim. Therefore, when things go wrong for you money-wise, it is important to know that in cases of unfortunate circumstances some areas of life are covered.
2. In case you are not covered and you find yourselves under financial constraint, the best advice is to speak to a debt counsellor who can help you look at your finances and see if they can negotiate a better repayment plan with your creditors.
3. As always, the best advice is to avoid using your credit card to pay for credit. Always pay more than your minimum payment amount for store and credit cards, use cash and savings to buy wants, and in tough times only buy what you need.
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