Financial experts expect inflation and the latest interest rate increase to make life more expensive for consumers.
Financial experts expect inflation and the latest interest rate increase to make life more expensive for consumers.
Ridwan Kajee, spokesman for Oasis Asset Management, says higher inflation and interest rates are making life considerably more expensive for South Africans.
His comments follow the announcement last week by the South African Reserve Bank of an increase in the repo rate by 50 basis points to 9,5percent, resulting in an increase in the prime lending rate from 12,5percent to 13percent.
Kajee says that Oasis Asset Management discourages consumers from using high-cost debt available through credit cards, microlenders and furniture retailers.
"It is important that consumers live within their budgets. One of the best investments is to repay existing debt. Consumers must be wary of falling into the debt trap."
With interest rates expected to rise in the next Monetary Policy Committee meeting of the reserve bank, South Africa's independent property investment club, YDL, says investors should use "the Rule of 3" and adjust their finances to suit market conditions.
The Rule of 3 means investors should add a 3percent increase to their bond repayments to assess if they would still be able to service the bond, have three months' worth of repayments invested in their bond and put down a 30percent deposit if they can afford to.
Anton de Leeuw, YDL managing director, believes that higher interest rates are here to stay for quite a while.
He says investors who followed the Rule of 3 before the last round of increases - totalling 2,5percent - would now not be concerned about their cash flows.
In addition, De Leeuw advises consumers to keep an eagle eye on their property expenses.
"Cut some to the bone if you have to, at least for a while." - Isaac Moledi
High rates, inflation make life expensive
Financial experts expect inflation and the latest interest rate increase to make life more expensive for consumers.
Financial experts expect inflation and the latest interest rate increase to make life more expensive for consumers.
Ridwan Kajee, spokesman for Oasis Asset Management, says higher inflation and interest rates are making life considerably more expensive for South Africans.
His comments follow the announcement last week by the South African Reserve Bank of an increase in the repo rate by 50 basis points to 9,5percent, resulting in an increase in the prime lending rate from 12,5percent to 13percent.
Kajee says that Oasis Asset Management discourages consumers from using high-cost debt available through credit cards, microlenders and furniture retailers.
"It is important that consumers live within their budgets. One of the best investments is to repay existing debt. Consumers must be wary of falling into the debt trap."
With interest rates expected to rise in the next Monetary Policy Committee meeting of the reserve bank, South Africa's independent property investment club, YDL, says investors should use "the Rule of 3" and adjust their finances to suit market conditions.
The Rule of 3 means investors should add a 3percent increase to their bond repayments to assess if they would still be able to service the bond, have three months' worth of repayments invested in their bond and put down a 30percent deposit if they can afford to.
Anton de Leeuw, YDL managing director, believes that higher interest rates are here to stay for quite a while.
He says investors who followed the Rule of 3 before the last round of increases - totalling 2,5percent - would now not be concerned about their cash flows.
In addition, De Leeuw advises consumers to keep an eagle eye on their property expenses.
"Cut some to the bone if you have to, at least for a while." - Isaac Moledi