The increased interest rates will mean that debt will become more expensive. While the difference may be small at the moment, any additional interest rate increases will start to really hurt your pocket – Nicolette Dirk, finance writer for Justmoney.co.za investigates.
27 June 2014
THE RECENT DOWNGRADE OF SOUTH AFRICA’S CREDIT RATING WILL MAKE YOUR WALLETS LIGHTER!
Fitch, Moody’s Investor Services, and Standard and Poor’s (S&P), three leading rating agencies, have all decided to downgrade South Africa’s credit rating from stable to negative, due to South Africa’s recent economic and socio-political changes and developments.
WHAT DOES THIS ACTUALLY MEAN?
A country’s credit rating is crucial to economic growth and stability, as this determines South Africa’s cost of borrowing of commodities and more importantly, is an illustrator for investor appetite.
The amount of money that enters the country, as well as the value of the rand, is dependent on a good credit rating, similarly to that of a consumer’s credit rating.
South Africa will struggle to attract investment, which will consequently decrease the amount of money entering into the country. As a result, government will need to get money from somewhere. And that somewhere is from your pockets.
HOW WILL THE CREDIT DOWNGRADE AFFECT YOU?
The forecast for South Africa’s economy is not great. Downward growth has been a consistent pattern of recent, and if this is anything to go by, we can expect increases in food costs, fuel prices and goods and services.
For many South African’s already feeling the pinch, the rise in the cost of living may be enough to push them over the edge.
Before your debt repayments become harder to manage, leaving you feeling frustrated and helpless and before you start missing debt repayments, taking more loans and destroying your credit record, speak to a DebtBusters today for a free credit health assessment.
HOW CAN DEBTBUSTERS HELP YOU?
At DebtBusters, we understand our clients’ needs for financial stability, through trusted and stress free financial and debt solutions, we can help you. We will assist by:
- Reducing your monthly debt repayments by up to 60%
- Renegotiating your interest rates from an average of 21% to an average of 3% on unsecured loans
Only pay what you can afford! It’s quick. It’s easy. Best of all, DebtBusters will bust your debt and not your budget!
Authors: Kelli Knutsen & Bhavesh Naran