3 Reasons to keep your budget in check in 2019

The holidays are over and with schools back in session, it’s back to reality for most South Africans. January is a notoriously tough month for consumers everywhere, and 2019 has certainly not been any different. At Libertine Consultants, we are in the process of assisting many overindebted consumers who spent too liberally over the festive season, and now need to take their finances in hand to ensure that they can make ends meet for the rest of the year.

Whether or not you overspent over the holidays, there are quite a few reasons to keep your budget in check in 2019. Here are three of the most important reasons why South Africans should be tightening their belts this year:

More than 25% of the workforce is unemployed

One in four South Africans over the age of 18 and under the age of 60 are currently unemployed. That means a quarter of the workforce has no source of income. These are staggering statistics. The situation is also not poised to get any better, as key jobs sectors such as mining and industry are expected to continue layoffs and retrenchments. Additionally, the uncertainty about the ANC’s land expropriation bill has dampened foreign investment interest, which is required to create jobs.

The agricultural sector is under severe pressure

The drought of 2018 is having an extended impact on the economy, as the much-reduced maize harvest drives up food costs throughout the country. Additionally, many farmers are considering a change of occupation in the face of land expropriation without compensation, leading to an even more unstable food supply chain and increased prices.

Reckless lending abounds

While most accredited financial institutions will put a consumer through a rigorous approval process before extending a line of credit, there are unscrupulous lenders out there who are only in it for the returns. According to the latest figures released by the reserve bank, South Africa's total consumer debt currently stands at R1,73-trillion. The World Bank has also recently ranked Mzansi as one of the most indebted countries in the world.

In a social climate such as ours it can seem that going into debt is normal because everyone else is doing so. Don’t feel pressured to live a life you cannot afford – live within your means, save, invest and build your wealth slowly.

These are just a few of the reasons to keep a closer eye on your household budget in 2019. Keep an eye on the blog in coming weeks and months as we share more helpful advice on making wise decisions where your finances are concerned.

In the meantime, feel free to reach out to a Libertine Consultants representative to learn more about our debt services and credit services.