July 2022 Debtfree Issue

SPECIAL
EDITION
ARE YOU
READY FOR
WHEN
DISASTER
STRIKES?
Issue 07 of 2022

EXCELLENCE IS DOING
ORDINARY THINGS
EXTRAORDINARILY
WELL
– John W. Gardner

WHAT MAKES US
EXCELLENT?
/ Unimpaired and automated PDA systems
/ Integration with top-ranked Debt Counsellor systems
/ Best customer support in the country – queries are resolved within 24 hours
/ Strong compliance and best-industry-practice implementation is at our centre
Call Saishen Krishnan
Head of Hyphen PDA | 071 884 7300
Or call our friendly support centre on 011 303 0060 - Option 2
or visit our website www.hyphenpda.co.za

FROM THE EDITOR
I remember as a kid watching a movie about a big
passenger liner ship that flips over upside down and
then slowly begins sinking. Around the same time we
watched a film about a massive residential building
that catches fire and the people who try to escape.
These were classic disaster movies.
We seem drawn to disaster. It is as if we don’t want to be caught in a
disaster ourselves but can’t look away when we see one.
My Instagram feed loves to show me clips of people (both sober and
not) falling off things or into things (however they fall, they always
seem to be hurting themselves) so, it seems the algorithm knows that
my fascination with disaster seems to be going strong.
Sometimes, if you have a lot of debt and are struggling to make ends
meet, it can feel like you are starring in a sick disaster movie of your
own. One where the main character wakes up in a cold sweat at night
worried about paying off their debt.
If you ever feel that way well, the good news is that in this issue,
we look at some steps you can take to try to future-proof your life
against disasters of various kinds.

These days, many people are confronted with serious disasters that
cause them immense pain and difficulty. When you are affected, it
can throw your life into total chaos. So, be sure to check out how you
can take steps to deal with similar challenges.
We also look at what goes on each year at the annual DCASA
conference and discuss the upcoming Debt Review Awards (which
we are a part of). Throw in some news and tips and you have another
packed issue of Debtfree Magazine.
Now your bank balance may currently look like a disaster, but it
does not always have to. If you keep up those monthly debt review
payments and try out some of the advice in this issue, the next
“movie” you star in is a fun comedy or a romantic one where you fall
deeply in love with living totally debt free.

FROM THE
DESK
SURVEY REVEALS
FINANCIAL STRESS
IMPACTS ALL
ASPECTS OF LIFE
South Africans feel high
levels of financial stress
is negatively impacting
their health as well as
their home and work lives,
but despite this most try
to deal with the problem
themselves rather than
seek professional help.

This is according to a new “Money-stress Tracker” survey of over
14,000 participants run by South Africa’s leading and largest debt
counsellor. It is one of the largest surveys ever done in South Africa to
determine how money-related stress impacts other aspects of life.
Seventy percent of respondents said they were experiencing financial
stress. Of these 94% felt this was impacting their home life and 77%
their work life. Seventy six percent believed it was affecting their
health.
Generally, women were more stressed about their finances, home
and work life and health than men. In particular, women were 30%
more likely than men to be stressed about their health as a result of
financial stress, and 20% more worried about paying their debt each
month, compared to men.
“This highlights the burden that comes with the critical role women
play in South African society and is something to consider as we
approach Women’s Day,” says Nosiphiwo Nxawe, manager of
payments at DebtBusters.
Over half of participants (52%) indicated they feel stressed or anxious
about running out of money before the end of the month. Other
major financial stresses were:
• Struggling to pay off debt each month – 36%
• Concerned about inflation – 27%
• Worry about unexpected expenses – 23%
• Battle to pay school fees – 15%
• Worry about having enough to retire – 12%

Perhaps unsurprisingly, financial stress was most acute amongst the
younger respondents and those with less income. However, 40% of
all respondents were spending over half their take home pay to repay
debt.
“More alarmingly, 72% of all respondents
need 30% or more of their take home pay to
repay debt. If one considers that DebtBusters
deems 30% of take-home pay to be the level
at which debt repayments can be managed
sustainably, one can conclude that 72% are
in an unsustainable debt position.“
“This is simply untenable so it’s not surprising that stress levels are so
high,” says Nxawe.
One in six people believed that they had less debt than their peers,
while five in six believed they had the same or more debt. Under 25s
generally believed that others had more debt than they did.
Reactions to dealing with financial stress ranged from cutting back
on monthly expenditure to selling personal items, with most people
(43%) opting to tighten their belts.
Twenty six percent looked to increase their income by finding a better
job. Unsurprisingly younger people were more likely to seek higherpaying
jobs. However, one in six (14%) said they felt stuck and didn’t
know what to do.

When asked why they hadn’t acted to alleviate financial stress 39%
responded they ‘felt stuck’ and 23% said they needed more time to
think.
Psychotherapist and Transactional Analyst, Diane Salters says people
seeking debt counselling are probably going to feel shame and fear,
not be thinking clearly and ready for fight, flight or freeze.
“Those in freeze mode will likely feel stuck. Many responded this
way in the survey. Those who are in flight mode will say they don’t
need debt counselling when the overall numbers saying they are
experiencing the effects of financial stress on their lives indicate they
do. If they freeze, they will do nothing. Or they may be ready to flee
or fight the debt collector, their partner or spouse or even their debt
counsellor.”
Nxawe says that comments from respondents who were currently
under debt counselling reflected the informal feedback DebtBusters’
receives from clients.
“Once the decision is made (to proceed with debt counselling), most
people feel an immense sense of relief. The fact that once in debt
counselling, they aren’t constantly having to answer phone calls
about outstanding payments also helps alleviate a lot of the stress.”

DEBT REVIEW
LESSON #1
What happens if you don’t have
enough money in your account
for a debit order?
When a debit order fails (due to insufficient funds)
banks typically charge a “penalty fee”.
Fees vary but they can be a couple of hundred
rand even.

CONTENTS
ARE YOU READY FOR
WHEN DISASTER STRIKES?
NATIONAL
(NOT) SAVING
MONTH
QUESTIONABLE
COLLECTION CALLS
ABOUT OLD DEBTS
DISCLAIMER
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can occur, consequently readers using this information do so
at their own risk. Debtfree Magazine makes content available
with the understanding that the publisher is not rendering legal
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or contributors accept any responsibility whatsoever for their
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and opinions of the Debtfree Magazine team. No person,
organization or party can copy or re-produce the content
on this site and/or magazine or any part of this publication
without a written consent from the editors’ panel and the
author of the content, as applicable. Debtfree Magazine,
authors and contributors reserve their rights with regards to
copyright of their work.

ARE YOU
READY FOR
WHEN
DISASTER
STRIKES?

ARE YOU READY FOR WHEN DISASTER STRIKES
IT’S A TOTAL
DISASTER
Disasters are becoming a part of
everyday life. People around the
world are facing crisis after crisis
with no sign of slowing down.
In some areas, natural disasters are hitting
hard, over and over, while in other areas social
and political upheaval has been disastrous to
the economy.
Faced with such an increase in disasters and
all that comes with them, how can we cope?
Can you prepare now, for a potential disaster?

MAP OF NATURAL DISASTERS RECORDED BY THE
NATIONAL CENTERS FOR
ENVIRONMENTAL INFORMATION USA

ARE YOU READY FOR WHEN DISASTER STRIKES
MORE THAN
EVER
Studies show that it is not your
imagination, there are more
disasters now than when you were
young. They are increasing in
frequency and in how much damage
they do.
2020 was a good example of how things can
change overnight. Your best laid plans can
quickly be thrown out the window, when a
pandemic or other disaster strikes.
In our own lives, we can face smaller but
just as devastating disasters. These sudden
circumstance changes can force us into
difficult situations.

ARE YOU READY FOR WHEN DISASTER STRIKES
FINANCIAL
DISASTERS
When faced with any disaster it
normally comes with a financial
cost.
We might be making good progress in paying
off our debts and covering our monthly costs
when a sudden disaster piles on these extra
costs.
We may need to cover a huge medical bill,
funeral costs, repairs to a vehicle or appliance,
or a family member suddenly loses their job.
All these things are hard to manage and can
leave you feeling drained and unsure about
how to cope.

ARE YOU READY FOR WHEN DISASTER STRIKES
EXPECT THE
UNEXPECTED
With disasters on the increase, we
need to mentally prepare ourselves.
We need to think what we would do
when faced with such challenges,
and have some broad ideas on how
we will react.
We also need to take practical physical steps
to prepare.
This may mean starting to save towards a
rainy day, or having a practice session with
the family for a natural disaster. Reviewing
question like these will help you to be
prepared.
• Where would you go?
• Who would you call?
• Do the kids know where you live and
where granny lives?
• Do they know phone numbers off by
heart etc.

ARE YOU READY FOR WHEN DISASTER STRIKES
NATURAL
DISASTERS
It seems that we read about a
different natural disaster almost
every day now. If it is not a Tsunami,
then a volcano, mudslide or
earthquake. There have been heat
waves and extreme winds and rain
all over the world. South Africa has
not been exempt, and those living
in KZN are all too familiar with the
ramifications of such a disaster.
Homes and businesses were left without
water, sewage connections or electricity.
Property was damaged and this created extra
expenses and hardship for those effected.
Suddenly, many people were presented with a
bunch of extra costs that they never thought
they would have. This is the reality when there
is a natural disaster.

Business can also be
seriously affected,
and it can cause
warehouses and shops
to close for long
periods of time. People
might shop less, as
they use their money
elsewhere to cover
costs. This means that
if you live in an area
affected by a natural
disaster, you could
face these challenges
of losing income or
even your job.

ARE YOU READY FOR WHEN DISASTER STRIKES
YOUR
VEHICLE
Having a vehicle is convenient, and
many use their vehicle to earn a
living.
Still maintaining a vehicle is expensive and
most people have to save a little each month
towards services and maintenance. New
tyres do not come cheap, even licenses are
expensive.
If someone rides into the back of you while
you are stopped at the traffic light, or when
something unexpected on the car breaks,
you are suddenly faced with extra costs that
can derail you budget and make it hard to
cover your regular monthly costs and debt
obligations.
Suddenly you realise why people say a vehicle
is a liability and not an asset.

FREE BOOKLET
TO DOWNLOAD AND SHARE
How do you leave Debt Review?
How do you have the Credit Bureau remove
the Debt Review listing on your credit report?
Leaving Debt Review Is Not As Simple As To Simply Stop Paying.
Consumers can only leave the debt review process at certain times
and in certain ways.
This free e book will help you navigate this process and avoid many
of the common mistakes people make when wanting to leave debt
review.
If you are curious about how you can leave debt review properly and
with no risk to your assets then be sure to download and read this
free booklet
DOWNLOAD AND SHARE

No more debt-stress.
Let’s get it sorted.
We’ll get your interest rates right down. You’ll
make one consolidated payment a month. You’ll
have more cash to live on. Your assets will be
legally protected. Sorted.
0861 365 910
www.debtbusters.co.za
info@debtbusters.co.za

ARE YOU READY FOR WHEN DISASTER STRIKES
MEDICAL
DISASTERS
We all fear getting ill. None of us
wants to face a prolonged or life
threatening illness. We would hate
for one of our loved ones to face
such a situation.
Besides that common fear, medical care,
particularly emergency care, often comes at a
high cost, doctors and dentists are not cheap.
Even a small slip down some stairs can have
you paying off bills at an emergency room,
doctors’ bills, crutches or heading to a
specialist to have an MRI to see what has been
damaged.
Those using public healthcare find that it
may be more affordable, but it often means
long hours, or even days spent sitting at the
hospital or clinic, which you could be earning
money.

ARE YOU READY FOR WHEN DISASTER STRIKES
CLAIMING FROM
INSURANCE
Debt Counsellors will often encourage clients to
review their insurance situation with an expert to
ensure that they are covered in case of a disaster.
Insurance is there to cover just such eventualities. It is prudent and
having good cover is often a requirement to access credit.
If you have had a vehicle accident, have to go to hospital or if your
geyser blows up and floods your home, then you may well be able to
claim from your insurance. This can take the sting out of the massive
bills that come with such disasters.
If you lose your job, then certain insurance can cover the costs of
your monthly debt obligations (including debt review repayments). Be
sure to ask an expert, or your debt counsellor about how that works.
Still, insurance claims often mean having to pay a hefty excess first.
Depending on how your insurance is set up, that can sting and where
does that extra money come from?

ARE YOU READY FOR WHEN DISASTER STRIKES
WHAT TO DO WHEN YOU
ARE CAUGHT BY SUCH A
DISASTER
It can be very hard and very unfair to
be hit by all the physical, emotional
and financial challenges of a
disaster.
It is very important that if you are in debt
review, and are faced with such a disaster,
that you do not rush into any decisions which
could derail your debt review.
Take a moment. Get a realistic overview
of your situation, consider the options
that are before you. Perhaps write down
the challenges and costs so you have the
information ready to consider.
Once you have an idea of the situation, be
swift in reaching out to your Debt Counsellor,
and ask them to discuss your options with
you. They can offer valuable insights.

ARE YOU READY FOR WHEN DISASTER STRIKES
A RECENT
EXAMPLE
As an example, consider the
consumers who live in KZN and
were affected by the flooding or
recent riots in the area.
Because they were in debt review, they were
not left on their own trying to figure out
what’s best. They were able to reach out to
their Debt Counsellors to get advice.
The Debt Counsellors then spoke to the
various credit providers about the situation.
Most were very sympathetic and open to
making temporary changes to repayment
plans. The Debt Counsellor was able to gather
info from their client, do some math and work
out a temporary repayment plan, and in some
cases a total rework of the overall plan.
Debt Counsellors were also able to remind
consumers about the different types of
insurance they had on their credit accounts
(or specialized ones they took out when they
began debt review).

This helped them to
cover the cost of debt
repayments for several
months, while they
were without income
or rebuilding damaged
property.
By not rushing into any
knee-jerk reactions
to the disaster, these
consumers were able
to stay in the debt
review process, which
affects them for not
only a few months but
years ahead.
We salute those Debt
Counsellors and credit
providers who went
above and beyond
in helping these
consumers.

EMERGENCY GO BAG
Important docs
Food & Water
Clothes & Supplies
Sergei Kokota
https://icon-icons.com/icon/water-apple-food-drink-fruit/53300
https://icon-icons.com/icon/construction-protection-boots-shoes/65646
https://icon-icons.com/icon/t-shirt-clothes-clothing/53306

DEBT REVIEW GO BAG
Don’t Rush To
Make Decisions
Phone Your Debt Counsellor
and discuss your options
Save for such
emergencies
Choosing icons created by Becris - Flaticon - https://www.flaticon.com/free-icons/choosing

ARE YOU READY FOR WHEN DISASTER STRIKES
PLAN
NOW
It may seem simply impossible to
prepare for the unexpected. We
never know exactly what type of
disaster we will face. It could be
any of the things we have already
mentioned, or something else
entirely. So, realistically how can we
prepare?
Since most disasters will have financial
ramifications, it is wise to set aside a little
money each month towards these things.
Such savings must be part of your budget.
• This might mean putting aside an extra
R100 a month towards insurance excess.
• It might mean saving another R100
towards an unplanned dental, vet or
medical emergency.
Saving something needs to be part of
your plan.

ARE YOU READY FOR WHEN DISASTER STRIKES
PLAN NOW CONT’D
Note: If you are using every available
cent each month to pay your debts and
your running costs and have no savings
whatsoever, then you need to talk to your
Debt Counsellor about making bigger changes
to where and how you are living, shopping
and earning.
Since insurance may help cover many risks,
it is worth talking to an expert about the best
and most cost-effective products which
are affordable. Many products have been
specifically tailored for people in debt review.
Have a go bag or supplies in your home which
can help in an emergency. Primarily, this will
be some long lasting food, and some water,
but don’t forget to have copies of documents
and helpful phone numbers too.
Consider practice sessions with the kids about
what to do and where to go in case of an
emergency.

DEBT REVIEW
LESSON #2
What happens if you don’t have
enough money in your account
for a debit order?
A missed payment on a debt (when your debit
order does not go off) will negatively impact your
overall credit score at the credit bureaus.
Credit providers use that score to see what rate to
charge you for new credit.

ARE YOU READY FOR WHEN DISASTER STRIKES
IN CASE OF
EMERGENCY
If you face any type of disaster that
affects your income and ability to
make ends meet, then be sure that
one of your very first calls, is to your
Debt Counsellor.
Even if it is a small challenge that is causing
you to stress, then reach out to your Debt
Counsellor sooner rather than later.
If you call them, you will get advice and help
that can assist you to make needed changes
or arrangements to cover such costs.
Remember: it is always best to speak to a
qualified Debt Counsellor and not just a
support staff member.
With disasters becoming more and more
common these days, it is likely that you will
face some sort of calamity in the future. Plan
ahead now so that you can successfully cope
when disaster strikes.

NATIONAL
(NOT)
SAVING
MONTH

NATIONAL (NOT) SAVING MONTH
IT’S TIME TO GET
YOUR
SAVE ON
Each year in July, consumers are
encouraged to save money during
National Savings month.
South Africans do not have a good record of
saving, and with the economy in such a state
these days, it is perhaps harder to do now than
ever before.

NATIONAL (NOT) SAVING MONTH
RESEARCH SHOWS WHY
SAVING IS
SO HARD
Recently, two of SA’s biggest debt
counselling practices released
the results of their surveys about
consumers current financial
situation and if they are saving, the
results are a bit scary.
DebtSafe spoke to 1400 people and asked
them how they cope. A very scary 61% of
those surveyed are actually sitting without
work, and find saving impossible. Recent
government stats also show that more people
than ever are unemployed.
Those who are employed told DebtSafe that
they are really struggling to save and pay their
debt obligations.
Debt Counselling practice DebtBusters spoke
to a whopping 14 000 consumers (specifically

those who are not in
debt review) and asked
them how they make
ends meet.
They found that 13%
are using short term
loans (like payday
loans) to service their
existing debt. 8% have
resorted to selling off
the things they own to
cover their costs, while
11% are turning to their
family and friends for
help to cover their
costs.
The traditional middle
class, and people 35 –
44yrs seem hardest hit
with the most financial
pressures, but they are
not alone. Basically,
everyone from all age
groups and incomes
are stressed about
their debt situation.

NATIONAL (NOT) SAVING MONTH
IT IS NOT
SUSTAINABLE
When DebtBusters did the math, and asked about
these 14 000 consumers situation, they found that
the financial situation of 60% is getting worse, and is
not sustainable. They are headed for a crash and need
serious help in making a sustainable plan immediately.
In other recent research from DebtBusters, it revealed that inflation is
growing faster than salary increases. This means that consumers are
losing buying-power each year.
They found that consumers lose about 5% of their buying power each
year. So over the last 5 years, consumers effectively have to get by on
75% of what they had back then, but with all the same obligations.
This can be especially hard for those in debt review who are working
according to a very tight budget and cannot use credit to plug any gaps.
The research shows that employees are dissatisfied with increases
and according to DebtBusters, 25% are looking for better paying jobs,
and plan to leave their employer if they can find something suitable.
Both practices say their research shows, that consumers are too
stressed by their growing debt and the increasing cost of living to
prioritise saving, most simply cannot save at all.

NATIONAL (NOT) SAVING MONTH
TIME TO RELOOK
AT OLD WAYS OF
DOING
THINGS
There are many within the debt
review industry that call for annual
reviews of consumer’s debt
repayment plans.
They expect that people should have more
money to repay their debt each year.
These ideas were even contained in the
NCR’s old 2009 task team report which is the
foundation of the DCRS system, how times
have changed!
Research and common sense now show
this is not realistic and it might be time to
reconsider things entirely in line with current
realities.

Perhaps debt
counselling software
should rather be
programmed to accept
further increase in
repayment terms, and
small reduction in
repayment amounts
each year, to allow
consumers to cope
with the realities of the
ever increasing cost of
living and inflation.
That is one possible
way to encourage
those in debt review to
start saving.

NATIONAL (NOT) SAVING MONTH
BUDGETING & SAVING
JUST NOT
HAPPENING
Having a monthly budget and saving
funds is really important and vital to
financial success.
It seems simple to say, but the reality is that
many consumers simply do not budget (it’s
not a lot of fun to budget and can be a little
scary). Interestingly, around a third of those
DebtSafe spoke to, said they had no idea how
to make a budget.
Times are hard and it doesn’t look like things
are going to get easier any time soon.
With such low levels of financial education
and the ever increasing cost of living and
inflation outstripping people’s ability to earn a
living, in the future we might realistically begin
to call July: National Not Savings Month.

DEBT REVIEW
LESSON #3
What happens if you don’t have
enough money in your account
for a debit order?
If you are under debt review and miss a payment
(due to your debit order not going off) then
your credit providers can try jump out of the
arrangement and can start new legal action
against you again.

STEP-BY-STEP
DREX GUIDE
DREX simplifies the exchange of data and makes managing the
debt review process less admin intensive.
The below links take you to step-by-step guides on how to use the
DC Portal on DREX.
How to Register on the DC Portal
Introduction to the DC Portal
Accessing a Consumer's Profile

QUESTIONABLE
COLLECTION
CALLS ABOUT
OLD DEBTS

QUESTIONABLE COLLECTION CALLS ABOUT OLD DEBTS
WHAT THE
LAW SAYS
In South Africa, like many other
countries, there are laws about
credit providers trying to collect
many years later.
The Prescription Act and refinements in
understanding from court cases and other
legislation stops credit providers from
forgetting about a debt and then many years
later coming back to demand payments.
In general* if you have not been contacted by
a credit provider about a debt for 3 years and
have not paid money towards that debt for 3
years and have not been taken to court over
this older debt then the debt has prescribed
(or died).
It then becomes illegal for credit providers to
collect such debt.
*and we are being pretty general here as there are specific laws all about
this sort of thing. Another good thing to know is that paying something
towards a debt that has already prescribed does not mean that the debt is
somehow active again and that you have to carry on paying. Once it dies,
it is dead.

QUESTIONABLE COLLECTION CALLS ABOUT OLD DEBTS
GIVE US
OUR MONEY!
But just because something is not
legal does not mean that you will
never get a call about such debts.
Recently, the Banking Ombud released stats
for 2021 and 2022 (so far) that showed many
consumers are asking them for help about
collection calls about older debt. While in
many cases the credit provider or collections
agents were justified in getting in touch, the
Banking Ombud found that around a third
of the matters that were brought to them
involved a credit provider or collections
company trying to collect on prescribed debt.
So, if you have some older debts that you
have nearly forgotten about don’t be surprised
if one day someone starts calling you about
them. Do, however, remember that older,
unacknowledged, unpaid debt does prescribe
if the credit provider has been too lazy to take
the matter to court.

WWW.DEBTREVIEWAWARDS.CO.ZA
The annual Debt Review Awards will
be held on Friday, 30th September in
Cape Town and online live streamed
over Youtube for all to enjoy.

The Awards recognise the hard work and excellence
of those working in the debt review field. Credit
providers, PDAs, over 50 Debt Counsellors and several
individuals in the industry will be recognized on the
day.
PEER REVIEWS
At present, the final rounds of peer reviews are
being done by various members of the industry. The
reviews are completed by registered individuals and
representatives who have many years of experience in
the industry.
During July and August many registrants will be asked
to do some of the most detailed reviews to date thus
far as we delve deep into the various criteria that is
considered. This can be things like:
• How does this credit provider assist you when it
comes time to get a paid up letter or sort out an
end balance dispute?
• It might be questions about how many of a
particular Debt Counsellor’s clients actually pay in
line with what has been promised in the proposals
and court orders.

This deep dive helps identify those within the industry
that are doing well, and that others should try and
emulate.
If you have not yet had much of a chance to complete
any reviews, you will no doubt be getting emails
and links from the organisers, various PDAS and
associations over the next few days.
We want to thank all those who have been completing
reviews this year and those still to do so.
The compiled and audited results of the peer reviews
will be announced live during the Awards show.
For more information, you can visit
www.debtreviewawards.co.za.
*Please note that only those authorised within a large credit provider can sign
up on behalf of the “brand” or department. This is checked by the Awards
organisers and audit team to ensure no duplication in submissions.