Finding balance between lending and spending

Find Balance

In today’s blog, we discuss balance in healthy lending versus spending. Let us start with the credit report which is a vital part when you are over 18 and seen as an adult who may have access to credit. When a credit report has a bad scoring or low scoring, either way it can have a negative outcome when applying for credit.

Bad scoring can be the result of paying creditors late, paying short or skipping payments on credit agreements. An example of a Low credit scoring is when an individual has never applied for credit previously, and have no credit scoring on how active accounts was managed.


  • Do a budget and make sure the monthly contractual payment is affordable.
  • Take good care of any credit agreement and pay the debt on time.
  • Protect the ITC report. It can take up to two years to recover from a bad credit listing.
  • When a credit application was declined do not go to other creditors and apply, if turned down again it will affect the credit scoring with a hard-hit score which is negative.
  • Every consumer is allowed a free credit report every year on his or her birthday.
  • Look for any fraudulent activity and report it immediately.

Before applying for any credit agreement, it is important to contact various banks and product houses that offer the same products and shop around to compare costs. When opening any new account, it is important to know what is the annual interest. This reflects on all types of finance charges that can be imposed on the credit transaction. Read the quotation, understand the terms and read the fine print. Familiarise yourself with the cost of the credit life insurance and how it will affect the monthly repayment affordability of the loan. When buying a vehicle that is used, be wary of call centre agents that want to sell you all sorts of products and additional warranties. Remember these products are added to the outstanding balance of the vehicle.


  • Comparing costs for credit will help you to choose the best affordable repayment plan to suit your pocket.
  • The annual interest percentage rate is useful to compare credit costings.
  • Read all the information on the credit agreement, and ask questions if something is not clearly understood. Do so before signing any agreement.
  • What additional costs are you paying for, for example: credit life insurance, service fees and initiation fees?
  • The Affordability of any credit agreement is vital to insure payments can be met until the debt is fully paid up.

To Obtain balance when spending money on household needs, a healthy and responsible budget is necessary.  Monitor the household expenditure per month and keep within the needs for the family. Allow the family to be part of the process of budgeting. It can be a lot of fun when the kids can see where they can reduce their expenditure and help their parent’s with ideas where to cut costs. Do not buy clothes and luxury items on credit. Seek the help of a financial planner to assist with retirement planning and other emergency savings. 20% of Nett salary should be allocated for this essential requirement. Debt should not exceed 30-40% of Nett pay.


  • Take the time in doing a budget.
  • Don’t buy things that are not really needed.

We at CDS are experienced in assisting consumers taking back control of their financial strengths. We offer free budget assistance.


  • If one’s debt exceeds 40% of disposable income, please contact our office for a free debt assessment.
  • Learn new ways of budgeting, practice it every month and stay in the habit.
  • Keep a close eye on savings and work with a Broker or a financial planner to get your money to work for you.

Finding balance in lending and spending is possible for anyone.

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