How to take advantage of interest rate cuts...
Considering the uninterrupted interest-rate cuts since December last year, we should all have some extra cash in our pockets.
The prime lending rate has gone down considerably since December, but are you making the most of these cuts?
Luke Hirst, MD of Debtbusters says ‘In these erratic financial times, any extra cash should be seen as a blessing and be spent wisely - especially if you are in debt.'
Here are some valuable tips from the Debtbusters team to help you to utilise any extra cash correctly, putting you in a better financial situation.
Clear expensive debt first:
Remember: personal loans, credit cards and store cards are all going to vary in the interest rates they charge. While it is important to remain up to date with all your debt repayments, any extra cash you may now have as a result of the interest rate decrease would be best used by servicing your most expensive debt first.
Remember - while you should never fall behind on any repayments, by paying in extra whenever possible, you can vastly decrease the amount of money you will pay and the term of your repayment.
Take now, pay later? Forget about it!
Swap your credit card for a debit card to make sure you only spend what you have. Yes, it is convenient to be able to take something now and pay for it later, but it makes for a budgeting nightmare. By using a debit card whenever you can, you will never spend more than you have and you'll avoid the added problems of interest on your purchases.
Only save if you are making more than you owe.
While the decrease in interest rates is great for the indebted, it also affects your prime linked savings accounts. If you put money into a savings account that is giving you 6%, aren't you better off using that extra money to service a debt that is costing you 15% interest? While saving is vital, getting out of debt should be your priority.
How to take advantage of interest rate cuts...
03 Jun 2009
Recent Articles
Featured It’s possible to change your marriage regime
Many people wed before they sign an antenuptial contract (ANC). This is especially practiced by people in customary marriages and those not clued up about the ANC. The law says if there’s no ANC before the wedding takes place, the marriage will automatically be in Community of Property.
Keep this in mind when taking out new financial products
Adding a product to your personal finance portfolio, such as insurance or an investment, is a big decision. We found out what you should keep in mind before taking out a new product, how you can assess the products you already have, and how you can generally improve your financial position.
Are you in debt denial?
With debt levels increasing at 13% more than income levels, South Africans are more debt-stressed now than arguably ever before. This is iterated by the National Credit Regulator’s (NCR) report that nearly half of credit-active consumers in South Africa have damaged credit records. However, only a few seek the necessary help.
Why should you invest in a mutual bank?
Often when people think about banking, they always think about commercial banks. Mutual banks hardly come to mind, but these banks offer investment opportunities that are often overlooked.
Deals
Aurora Spa 100-minute Treatment Special
Price: R449
When: Until 31 March
Where: Century City
Woodstock Grill and Tap Steak Thursdays
Price: R100
When: Thursdays
Where: Woodstock
KFC 5+5 Special
Price: R65
When: Until 25 February 2020
Where: Nationwide
Our suppliers and companies we review
