Financial problems are a universal problem that consumers face daily. Although there are various types of problems, there are common problems that nearly all over-indebted consumers have in common.
Undoubtedly one of the biggest financial problems for consumers, debt is the top reason that consumers find themselves facing financial ruin. Debts can rise with the cost of living or as interest rates climb and as a result consumers can find themselves in a position where their debts are no longer covered by their incomes.
- Unexpected Expenses
Consumers can be caught unawares by a sudden expense such as a broken car, home disaster or broken computer. These expenses may force them to spend money that they do not have, or use credit cards or small loans to cover these expenses. Therefore consumers should always put aside savings to cover these unexpected expenses.
As consumers age and retirement becomes a real possibility, they begin to realise that they may not have put aside enough money to live on once they are no longer employed and ready to retire. As a financial problem this can affect anyone as they continue aging. It is therefore wise that consumers put a considerable amount of planning and effort into their retirement plans so as not to find themselves bankrupt 10 years into their retirements.
- Medical Expenses
One of the most frightening expenses for consumers is the thought of sudden medical expenses. Sometimes financial problems may force consumers to go off their medical aid, or medical aid contributions may become too high to cover. Unfortunately medical care is extremely expensive and can cause endless financial problems for consumers.
- Inflation and the Cost of Living
Lastly a financial problem that every consumer faces daily is keeping up with inflation and the cost of living. In South Africa the cost of living is rising at a pace that consumers are finding hard to keep up with. Fuel, groceries and electricity prices are climbing to record highs, and consumers are battling to make their budgets adjust to this.
These financial problems can cause endless nightmares for consumers who do not consider the aid of help for financial problems. In order to prevent bankruptcy and complete financial ruin, it is wise that consumers seek the assistance of debt counsellors to help them manage their finances in a more effective manner.
Article written by: Andrea van Tonder 07-2013