Updated 12.06.2021

12 Ways to Get Out of Debt Fast in South Africa

Millions of South Africans are said to be over-indebted and struggling to keep their monthly repayments in order. They smear their credit records and suffer from long-term consequences, making it even harder to obtain competitive financial products in the future.

To make sure you avoid over-indebtedness, here are 12 ways on how to get out of debt that you should try right away:

1) Stick to a budget

Budgeting is the first step you should learn to get out of debt. 

If you don’t know how to manage a budget, you can start with the 50/20/30 concept. The idea is to divide your income into 3 categories: essentials, savings, and entertainment. 

50% of your household income should go into essential expenses. This includes groceries, utilities, rent, and insurance payments. 

The next 20% should be allocated to debt repayments, savings, and investments. Only a fifth of your household income should go to debt repayment to make sure you don’t get over-indebted. 

The remaining 30% can be put into entertainment expenses. You also need to reward yourself, so that you wouldn’t get burned out on saving money and repaying debts.

Although this kind of budgeting method isn’t a one-size-fits-all formula, it’s a good guide to start with. Feel free to alter the allocation according to your financial needs. 

The way to get out of debt fast and safely without sacrificing other aspects of your life is to keep it at a minimum level. By doing this, you can easily allocate more into debt repayment from other budget categories like entertainment to repay your loans faster.

To help organize your budget, use a spreadsheet or a budgeting tool. They’re free to use, so there’s no excuse not to utilize these wonderful apps.

2) Pay more than the minimum

Interests pile up so long as the debt is not repaid, and this is what you’ll experience if you pay only the minimum per month. You’ll be barely making a dent on your debt if you only chip away a small portion of it. 

Pay more than just the required to bring down the principal as quickly as possible. This will minimize the impact of interest on your debt in the long run. 

Generally, the advice is to pay more than the minimum, but this will depend on your repayment strategy. Make sure that you don’t get burdened with debt for a long time or you’ll effort will be for nothing.

READ ALSO: 10 Best Tips to Avoid Debt in Your Life

3) Select the best repayment strategy

If you ask what the two most popular repayment methods on how to get out of debt, you’ll get the snowball tactic and the avalanche strategy as answers. 

  • Snowball tactic

Based on its name, the concept behind the snowball method is to repay smaller debts first before moving on to bigger loans. Just like a snowball rolling down the hill, you pick up the pace as you get to tackle bigger loans until you completely get out of debt.

To start with this method, assess first which of your loans is the easiest to repay. Usually, it will be the debt with the lowest interest rate.

The next thing you should do is to allocate the minimum monthly requirement for all the loans to make sure you don’t get penalties in any of them. After this, focus on the smallest loan and find a way to repay it the quickest way you can. 

Once you’ve paid off the smallest loan, you close it and move on to the next one. You’ll continue to do this until all your debts have been repaid.

  • Avalanche method

The avalanche method, on the other hand, works the opposite of the snowball tactic. It aims to pay off first the largest debt with the highest interest rate so that you’ll save more money in the long run. It’s more cost-effective than the snowball tactic, but it’s harder to execute. 

The strategy works by arranging your debts from the highest interest rate to the lowest. You’ll repay the minimum due amount for each debt while pouring extra cash on the largest loan. Keep doing this every month until you pay off the largest debt before moving on to the next one.

Whichever repayment strategy you choose, the core idea is to focus on repaying a single loan as quickly as possible before moving on to the next. This will get you out of debt faster than expected. 

You don’t have to limit yourself to these two methods. You can combine them and see which works best for your financial situation. 

4) Talk to your creditors

Talking to your creditors is one of the little-known ways on how to get out of debt faster. This doesn’t mean you can sweet talk your creditors into forgetting your debt. You talk to them to give you a better deal that will make repayments more favourable to you.

If you have a good credit standing and you’re always on-time on repayments, you can negotiate for more competitive rates. There’s a chance you’ll get lower interest rates or waived fees, depending on how much your creditor can offer.

But if you’re having trouble keeping up with debt repayments, there’s no harm in contacting your credit provider. They’re usually open to easing up on payment terms for valid reasons. Just be honest with your situation and tell your creditors right away about your financial problems.

If you manage to get a better rate, make sure you get it into writing. You need proof or a confirmation email officially stating the changes in your loan terms. This will serve as your protection in case you’re questioned about the updates on your repayments.

5) Cut on your expenses

Although this is not a direct solution on how to get out of debt, the money you save on unnecessary expenses can be used for repayments.

What you’re doing here is putting a halt on your spending and digging a deeper grave for yourself. You won’t be able to reduce your debt by just paying only the minimum required so that you’ll have more money for shopping and entertainment.

6) Sell your stuff

Look into your closet and see if there are any unused or rarely used stuff in there that you can sell. Getting rid of things that don’t increase in value is one of the ways to earn money that can eventually get you out of debt. 

Your trash can indeed be someone’s treasure. Used books, clothes, gadgets, and old appliances can all be sold at the secondary market. Instead of letting these things sit and gather dust, you can just sell them to help pay your debts.

7) Earn more money

The simplest, yet hardest thing to do to get out of debt is to earn more money. But increasing your household income is easier said than done. Asking for an increase or promotion from your employer can be unnerving, but it’s worth the try if you want to quickly pay off debts. 

You can also take part-time jobs after regular work hours or a weekend gig you can do during your time off. Every rand you make count toward repaying your debts quicker.

Another thing you can do is to monetize your hobbies. Painting, cooking, baking, and doing arts and crafts can be a way to increase your income, so don’t hesitate to take advantage of your talent.

8) Set aside tax refunds and bonuses

Want to know where to get funds to quickly get out of debt? Bonuses and tax refunds. 

Instead of being tempted to buy things you don’t need, use bonuses to make lump sum payments toward your debts. This will accelerate your repayments and greatly reduce the principal being charged with interest. 

It’s okay to reward yourself from time to time but overdoing it will just get you into more trouble. Sacrifice leisure for the meantime so you’ll have more money to pay your debts first.

9) Halt using credit cards

Using your credit card while you’re already in debt just increases the chances of getting over-indebted, especially if you’re a big spender.  

If you need to buy something, pay in cash. Avoid using your credit card and pay in installments because this will just increase your financial burden. Just remember that if you can’t afford to pay it in cash, don’t buy it. 

Stash away that plastic and keep it out of reach of adults. As they say, “out of sight, out of mind.”

10) Switch to a new lender

If you’re not happy with your creditor because they won’t give you lower rates, shift to another one with more friendly rates. Banks often offer balance transfers to entice customers to do business with them instead of their competitors.

Shedding even a 0.1% on your interest rate can be a big help, despite how measly it looks. When you compute its long-term impact, you’ll be surprised how much you’ll save by negotiating a lower rate. 

But before you apply for a balance transfer, know that there are fees involved in doing so. Calculate how much it’ll cost you to switch to a new lender and compare it with how much you’ll save on their lower interest rate offer. If you think it’s worth the trouble to switch to a new lender, then do it.

11) Change your spending habits

If you’re used to buying things you don’t need or eating out at fancy restaurants every week, you may have to change these habits if you want to get out of debt fast. Refocus your attention on spending on leisure and entertainment to paying off your debt as soon as you can. 

Instead of always buying coffee or meals, try making them on your own. Maybe you can limit buying food only once or twice a week when it’s your busiest schedule and you don’t have the time to prepare meals. 

By becoming more disciplined with handling your money, you’ll be able to swiftly pay off the debt while you build up the habit of smarter spending.

12) Save money to stay away from debt

The easiest and fastest way to get out of debt is to not get into one that you can’t handle. Before you take a loan or apply for a credit card, make sure you have the means to repay them without causing a significant impact on your lifestyle. 

Allocate a portion of your monthly earnings into short, medium, and long-term investments. If you want to have a solid financial base, you should start investing your money and not just saving it for passive gains.

For short-term investments, try opening either a money market or a fixed deposit account. If you want bigger gains, mid-term investments like unit trusts, retail bonds, and ETFs are great options. But if you’re aiming for maximum gains and you can wait for around 10 years to reap your rewards, go with aggressive long-term investments.

Aside from savings and investments, make sure you have an emergency fund that you can tap into during rainy days. Instead of borrowing money, you can use this fund for unexpected expenses and circumstances. 

Finally, once you get out of debt, stay out of it as much as possible. You’ve experienced the difficulty of worrying about repayments and you most likely wouldn’t want to be in the same position again. Build up your savings and investments so that you wouldn’t have to go into debt again.


The key to paying off debts quickly is discipline, and it’s a thing that’s easy to blurt out but difficult to build up. However, if you want to avoid paying more than you should and reduce the risk of becoming over-indebted, you’ll do everything to stay in control of your finances. 

We’ve presented numerous ways on how to get out of debt in South Africa, but most of them centre on two things: spending less and paying more. By keeping these things in mind, you’ll surely be paying off that debt in no time.

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