Are You Over-Indebted? 5 Warning Signs of Over-Indebtedness You Can't Ignore

Feeling the pinch financially? Many South Africans are currently grappling with debt, but how do you know if you've crossed the line into being over-indebted? Recognizing the signs of over-indebtedness early is crucial for taking proactive steps towards financial recovery. At CDS Consulting SA, we want to help you identify these warning signs so you can seek help before the situation escalates. Ask yourself: am I over-indebted? Here are five key indicators:

1. Relying on Credit to Cover Basic Living Expenses: If you find yourself using your credit cards or taking out loans to pay for essential needs like groceries, rent, or utilities, this is a significant red flag. It indicates that your income is no longer sufficient to cover your basic cost of living, pushing you further into debt.

   
   

2. Only Making Minimum Payments on Your Debts: Consistently paying only the minimum amount due on your credit cards and loans means that a large portion of your payment is going towards interest, and your actual debt balance is barely decreasing. This can lead to a cycle of debt that is difficult to break free from.

   
   

3. Missing Debt Repayments or Paying Late: Regularly missing payments or paying them late can result in penalty fees and negatively impact your credit score. This is a clear sign that you are struggling to manage your debt obligations and that your current repayment schedule is unsustainable.

   
   

4. Constantly Worrying About Money and Avoiding Creditor Calls: Persistent stress and anxiety about your financial situation, coupled with avoiding calls or communication from your creditors, are strong emotional indicators of being over-indebted. This constant worry can take a toll on your mental and physical health.

   
   

5. Having No Money Left After Paying Your Debts: If, after making all your debt repayments each month, you have little to no money left for other essential expenses or savings, it's a sign that your debt burden is too high. You are living paycheck to paycheck with no financial breathing room.

   
   

If you recognize one or more of these signs of over-indebtedness in your own life, it's important to take action. Contact CDS Consulting SA today for a confidential consultation. We can assess your situation and discuss potential solutions, such as debt counselling, to help you regain control of your finances and work towards a brighter financial future. Don't let the feeling of struggling with debt overwhelm you – help is available.