7 steps to a debt-free 2018

If you're setting your financial goals for 2018, it is a good time to include matters like protecting your finances, being financially free and getting rid of debt woes, according to Matthys Potgieter, spokesperson and debt expert at DebtSafe. Potgieter highlights seven significant steps you can incorporate into your 2018 financial resolutions: 1. Re-evaluate your monthly expenditure to make room for savings It’s easy to miss the small and ad hoc bills that all add up. However, if you calculate and pin down your expenses on a budget sheet, you’ll know exactly what your actual spend per month is and what you can save. This will also help you draw up an accurate budget that truly reflects income and expenditure, so that you can prevent accidental budget overspending. 2. Check your credit record and make sure the info on it is correct Do you know what your current credit profile looks like? You can download your record once a year for free. Visit the websites of TransUnion, XDS or Experian. It is always good to know that your credit record is in check. Be alert and make sure there's nothing fishy going on with your credit score. If you see something suspicious, sort it out right away by getting in contact with the relevant credit bureaus. 3. Stop playing victim and put an end to your reckless borrowing You are responsible for your debt and finance management. If you are not going to control your spending splurges, nobody else will. Don’t be a blame-shifter. Instead, do the necessary research and compare rates and costs from different credit providers to see if you can afford a loan(s) or item(s) before applying for any credit.

4. Catch up on your reading and become financially literate It is about time that you read up on the National Credit Act and regulations, the National Credit Regulator, the Consumer Tribunal and what alternative dispute resolution agents (like the credit bureaus, debt counsellors, the ombudsman for banking services or the credit information ombudsman) involve. You won't just broaden your consumer rights knowledge, but you’ll also create a money-savvy culture for yourself by being a financially clued-up person. 5. Put a dent in your debt Consider one of two options when trying to get rid of your debt: Make use of the so-called snowball effect by paying off your smallest debt first (like a clothing account); or Use the avalanche method, where you pay off your debt with the highest interest rate first - like your credit card.

6. Protect your debt Debt obviously has a negative connotation, so how are you supposed to "protect your debt"? Life happens and you must therefore protect what is most important to you. You don’t want to leave your loved ones with a debt mess, do you? Make sure you have credit-linked insurance to take care of yourself and your loved ones when unpredicted (or in some cases predictable) things happen like temporary or permanent disability, retrenchment and maternity leave as well as death. 7. Talk to professionals in the financial field Talk to your financial adviser or banker, and get their feedback and support.