The problem with lending a Saffa mate some moola is that they always promise to pay you back ‘just now’ and ‘now now’, which might account for the recent findings by the World Bank.

Sorry folks but it doesn’t make for pretty reading because we are, according to the survey, the biggest borrowers in the world. The situation even prompted an amendment to the National Credit Act (NCA). Here’s IOL breaking it down:

Credit Ombudsman Nicky Lala Mohan said the World Bank survey showed that South Africans had more debt than any other nation. According to the World Bank, 86 percent of South Africans have debt, followed by the Iranians, where 71 percent borrow money…

South Africans’ debts were mostly home and car loans and credit cards, and many people who could no longer get credit turned to loan sharks.

The changes to the NCA have made the credit application process more regulated, stipulating that those applying must fill in a prescribed minimum amount for living expenses in order for credit providers to better understand their financial situation. Here’s Ombudsman Mohan once more:

One of the reasons for the high default rate was the fact that reckless credit agreements were part of normal business practices for many credit providers…

Some people would declare their monthly expenses as being as little as R22.

So what can we learn from the above then? Firstly any credit provider who accepted an application that gave R22 as monthly expenditure is clearly taking the piss.

Secondly it pays to look after your financial future from the get-go and there really is no better time to start than now. I know it’s daunting but that’s why we keep on telling you to meet the good folk at Consequence Private Wealth. As well as being hands on with each and every client founders Michael Furter and Jeff Middelmann stick to three central premises:

•     The most valuable advice is given from an objective viewpoint. Full independence from all product providers is crucial.
•     In a tough economy it’s worth analysing costs closely. We ensure you understand all your financial fees.
•     Clients are put off by overly complex products and explanations – we keep it clear and concise.

You know we like clear and concise. I guess what it boils down to is this: the consequences of decisions made today will unfold over a lifetime based on the sound principles applied at their inception.

Start today and reap the benefits tomorrow – it beats filling out dodgy forms at even dodgier credit providers any day of the week.

[source:iol]