Story about debts and a young professional.

I got permission from the lady to share her story.

[THREAD]

Few months (May) back I got a DM from a young lady from Durban who was asking me to help her with her debt problems and I refused to because I am not an expert in such matters and also I had alot in my hands

After weeks of asking I ended up agreeing to help her.

I asked her to send me how much was her total monthly income and her monthly expenses(Bills and debt).

First thing I noticed was that her debt to income ratio was seating a 51%! She is a 26 year old with no kids and earning R12 500 per month staying with her mother at home.

Meaning each month out of her total R12 500 salary working for tech company she pays R6 300 to debt (including car insurance and all the other policies she had)

So I did not want to deal with her debt I told her it is something she needs to deal with herself but one thing which I was concerned about was the other 49% of her salary which from my view was mismanaged and her family was holding her back on.

Firstly there was no need for her to pay a monthly premium of R820 for DSTV so that her family can enjoy themselves. I told her to cut it down to DSTV access for R120 if her family wants M-Net they also have to contribute into paying for DSTV.

Secondly, her little brother who was still in high school was not her full responsibility. She needed to cut his allowance of R600 per month and also downgrade him from using a taxi to go to school to a public bus and she will save R370 per month just by her brother using a bus.

Thirdly, she was spending over R1100 per month on data and her reasons for that why that she hotspots her brothers when at home. I suggested if that is the case she needs to move from vodacom to Rain and pay R479 per month for unlimited data and also buy a pocket Wi-Fi router.

The last thing I told her she needed to go collect all the money she borrowed her brothers and they did not pay her back. In total both her older siblings owe her R8000 and she was able to get R5000 back.

On the debts she was able to renegotiate her payments system with her credit providers and she used her savings for December holiday to pay off three of her clothing account plus also reduce her one other loan.

In total now she saves:

1) R620 on data
2) She got R5000 back from her brothers to use to pay some of her debt.
3) By cutting down on her last born brother she saved R930
4) Save R700 on DSTV

By also renegotiating with some of her credit providers and also paying off her clothing accounts, her debt to income ratio is now at 39% and she has alot of money to start rewarding herself and set up an emergency savings account plus also start saving for her own future.

As always my thinking process is in Siswati and I have to write in English, 1+1= Alot of English errors.

Please do forget me I am still improving