Debt has become a major concern for many South Africans, causing financial stress, strained relationships and limited opportunities for growth. With the rising cost of living and the challenges posed by the current economic climate, debt counselling could be your saving grace. It’s no surprise that South Africa’s debt levels have reached alarming proportions.
Debt counselling provides a ray of hope for those who are drowning in debt. According to the South African Reserve Bank, household debt reached a record high of 78% of GDP in 2022. This means that the average South African home owes nearly twice its annual income! These figures reflect the severe financial stress that many individuals and families face across the country.
Several factors contribute to South Africa’s rising debt. High unemployment rates, currently at 32%, leave many people unable to meet their financial obligations. Inflation and rising living costs make it difficult for South Africans to keep up with their bills. Furthermore, a lack of financial literacy and inadequate financial planning skills aggravate the debt crisis.
What is debt counselling?
Debt counselling is a process in which a trained professional, known as a debt counsellor, assists people who are over-indebted. The process seeks to find a solution that allows individuals to become debt-free and reduce the severe mental stress associated with hefty repayments.
A debt counsellor assists people in better understanding their financial situation, including their income and expenses. Based on this information, the debt counsellor creates a realistic and long-term debt repayment plan, which may include negotiating with creditors to lower interest rates or extend payment terms.
Debt counselling aims to help people regain control of their finances by presenting them with a clear plan of action. Debt counsellors may also provide financial education, empowering individuals with the knowledge and skills needed to make sound financial decisions in the future. Throughout this process, the counsellor offers ongoing support and guidance to ensure that the individual stays on track to financial freedom.
The benefits of debt counselling
Debt counselling is a lifeline for people who are drowning in debt. Individuals can regain control of their finances and begin working towards a debt-free future as a result. One of the biggest benefits of this process is the formulation of a debt consolidation plan. This is the process in which people combine their debts into a single, manageable monthly payment.
This simplifies the repayment process and reduces the possibility of late payments or additional fees. Debt counsellors also educate their clients on financial matters, providing them with the knowledge and skills they need to make sound financial decisions in the future.
Numerous success stories have shown how debt counselling has changed people’s lives in South Africa. Individuals who were once in debt have regained financial stability and improved their credit scores at the end of the process. Individuals can rebuild their lives and move towards a more secure financial future with a customised debt repayment plan and ongoing support from their counsellor.
The role of MSD Consulting
MSD Consulting is a South African debt counselling firm dedicated to assisting individuals in overcoming debt challenges and achieving financial freedom. MSD Consulting has a team of qualified debt counsellors and financial experts and provides personalised debt counselling services tailored to each client’s specific situation.
We collaborate with clients to create a debt repayment plan that fits their income and expenses. MSD Consulting is also able to secure better interest rates and repayment terms for their clients by negotiating with creditors on their behalf, reducing the overall burden of debt. Furthermore, MSD Consulting approaches debt counselling holistically by providing financial education and empowering individuals to make informed financial decisions.
Our work begins when you fill out the application form. We determine whether you are over-indebted, in other words, do your monthly expenses and debt exceed your monthly income? If you are over-indebted, we then inform all your credit providers and the credit bureaus that you are under debt review.
MSD Consulting with then restructure your payment plans and negotiate with your credit providers where necessary. Your restructured payment plan will reduce your monthly debt repayments to an affordable amount, leaving you with sufficient money for your living expenses. It’s important to note that once you apply for debt counselling, you cannot take on more debt until the process is complete.
We will also instruct our attorneys to apply to court to make your restructured payment plan a court order. You will not have to appear in court yourself, as your debt counsellor will be the applicant in the matter – unless the particular magistrate requires your presence. The process will now be completed and you must ensure that your monthly payments are made timeously.
Don’t be afraid to apply for debt counselling
Debt counselling is a good option for South Africans who are over-indebted and feeling the extreme pressure of this financial burden. South Africa’s current debt situation necessitates immediate attention and this process offers a viable solution for citizens.
Individuals can use debt counselling to consolidate their debts, create realistic repayment plans and gain a better understanding of their current situation. The process allows people to take a step back and figure out what steps are needed to avoid falling back into debt. MSD Consulting offers personalised debt counselling services to South Africans in need.
If you find yourself drowning in debt, don’t hesitate to seek help from MSD Consulting through our services. Remember, taking the first step in this process is a proactive move towards regaining control of your financial life. Your journey to a debt-free future starts by contacting us today.
MSD Consulting is a registered debt counselling firm, committed to providing debt relief to all South Africans struggling with their monthly debt obligations. Our team of qualified debt counsellors and financial experts provide personalised debt counselling services tailored to your situation. For more information on debt resolution, follow us on Facebook and Instagram.