This is the perfect time to adjust your finances ahead of the festive season

Here are the three steps to take ahead of the festive season. With every South African’s favourite time of year, December, just a few weeks away, the National Debt Counsellors (NDC) says now is the perfect time to adjust your finances for an enjoyable festive season. For many people, December is a time to relax and celebrate the year’s milestones while setting goals for the next year. However, given current inflation and the cost of living, some people might not have the luxury of spoiling themselves without going into debt. 2026: Pressure on household budgets René Moonsamy, director at the National Debt Counsellors, says pressure on household budgets has increased over the year. Key factors pressuring household budgets include the South African Reserve Bank’s decision to raise the policy rate for the first time in three years, taking the prime lending rate to 10.5%, with fuel and food costs among the pressures driving inflation higher. The National Credit Regulator’s latest Credit Bureau Monitor, covering the quarter ended June 2025, recorded 10.54 million of South Africa’s 29.24 million credit-active consumers as carrying impaired credit records – more than a third of everyone in the country holding a credit agreement. Changes to make Moonsamy adds that adjusting your finances for December is less about dramatic cuts and more about seeing the full picture of what a household owes, what it costs, and what it can genuinely afford. “When people ask me where to start, I suggest just three things. Reconcile, adjust and plan,” she says. “The objective is to know exactly where your money is going, make deliberate adjustments, and then plan for what is coming next.” Three steps to take Moonsamy sets out three clear steps South African households can take ahead of the festive season: 1. Reconcile every financial commitment: This includes recurring expenses, insurance, savings, assets, and every credit agreement, including outstanding balances, interest rates, instalments, and other credit costs. A proper debt audit looks at more than the monthly instalment – it considers the outstanding balance, the interest rate, the remaining term, the repayment, whether the account is up to date, and what that debt is costing overall. 2. Adjust the budget: Identify where expenses can realistically be reduced and where money can be redirected toward debt or savings. Recurring costs are the easiest to overlook. Things like streaming services, app subscriptions, gym memberships, bank charges, insurance products and data costs accumulate quietly. So does repeated discretionary spending on takeaways, convenience purchases and online shopping. 3. Plan: Build a realistic budget for the next 12 months, not just the month ahead. This lets a household anticipate annual expenses, seasonal spending, and periods when household costs are likely to increase. Keeping track of finances Moonsamy recommends getting a credit report from a credit bureau and comparing it with household records, which can help identify forgotten accounts, incorrect information, or debts a consumer has lost track of. “Most importantly, compare your total monthly debt commitments with what you can genuinely afford after essential household expenses,” she says. “A debt audit is useful because it moves the conversation from ‘I think I am coping’ to knowing exactly where you stand financially.” She also advises households first to ensure important contractual commitments are maintained, and to avoid letting accounts fall into arrears simply because they are directing all available money toward one particular debt. Buy in bulk to save She adds that high-interest, expensive short-term debt is often sensible to target first because it costs more over time; however, the consequences of missing a payment matter as much as the cost, particularly where a home or vehicle may be at risk. Moonsamy also points to how households buy certain essentials, saying: “Repeatedly buying prepaid airtime or data each week may ultimately cost more than an appropriate month-to-month package. “The same principle applies across many household expenses where small, frequent purchases can sometimes be more expensive than a properly planned monthly option.”