Consumers keep their debt hidden

By Staff Writer
A recent study in the United Kingdom shows that 1 in 3 consumers hide their financial problems from their family. The UK's "hidden" debt amounts to an estimated £55bn.

Luke Hirst, MD of Debt experts Debtbusters, says ‘This statistic looks just about right for the South African consumer in Debt. It is a common problem that we see all too often. A consumer is ashamed of their over indebtedness and instead of taking the steps to correct the problem, they bury themselves in sleepless nights, anxiety and alcohol abuse.'

The UK report shows that one in five consumers are hiding their debt from their partner, while a tremendous 78% of people who have hidden debt have never confessed to the true extent of their financial dilemma. Of the 22% who did, the majority (60%) were caught out rather than chose to come clean.

Hirst continues, ‘There is such a negative stigma around debt that consumers try to pretend it is not there. This is not a solution and only exacerbates the problem. Consumers need to be aware that there are solutions out there which are specific to each individuals needs. ‘

‘With 161 749 applications for Debt counselling in South Africa to date, and this number climbing month on month, more attention needs to be given to Debt Review as an option. The stigma surrounding asking for help and approaching a registered Debt Counsellor needs to be removed. ‘

The research report went on further to say that of those who were found out, a quarter (25%) reported that they still tried to deny everything, despite the same proportion (26%) stating that hiding the debt only made their money problems worse. A breakdown of spending habits showed that expenditure on clothing was the item women were most likely to lie about while for men it was alcohol.

The dishonesty led to anxiety, with 43% complaining of loss of sleep, 21% of mood swings and 12% admitting that they drank more alcohol; 12% said they could no longer do their job properly.

Recent Articles

Featured Which one should you get first: life cover or a retirement annuity?

Financial planning can be a brain-racking process because it means making difficult decisions such as choosing the most suitable products for you. The one challenge faced by those who are financially constrained is which product to choose: life cover or a retirement annuity (RA).

Read more

Should you save or invest your money?

While saving means putting away cash for future use, investment involves purchasing assets which will yield good returns in the future.

Read more

Retirement annuities compared – pick the one for you

When selecting an RA you must know the type of annuity you are investing in. Retirement annuities are divided into two categories: traditional and new generation annuities.

Read more

Recent tax changes – how do they affect you?

In January this year, various amendments to the Taxation Laws Amendment Bill and the Tax Administration Act were announced. While some changes will benefit you, others could be to your disadvantage. Justmoney looks at how some of the recent changes will impact you.

Read more

Sign Up

To our weekly newsletter for advice you can bank on

Deals

Save R100 when you buy a tracker at Takealot

Price: R289
When: Daily
Where: Online

Pamper yourself and partner for less at Bakwena Day Spa

Price: From R999
When: Until 31 July
Where: Hartbeespoort

Pay only R35 for the new Nandos Boujee Bowl

Price: R35
When: Daily
Where: Nationwide