Tito Mboweni has a problem that’s familiar to most South Africans – limited income and lots of obligations. Although his headache is a lot bigger than the citizens he serves and the decisions he makes will affect every South African, there are some principles that are common to the national budget and the way householders manage their finances.

The ability to generate more income is one of these. The finance minister depends mainly on money raised from taxes. Just as it’s difficult for most people to increase their income by asking their boss for an increase or trying to grow their business, so the minister has limited scope to increase taxes.

This leaves another option; to reduce expenditure. As any householder knows, this is often easier said than done. Like the rest of us, Minister Mboweni must consider where cuts can be made and what the consequences are. Education? Healthcare? Safety and Security? Energy?

Householders have similar decisions to make. Do you reduce bond or rental payments by selling or moving somewhere cheaper? Stop paying for your children’s tertiary education? Cancel medical aid policies or armed response contracts?

For many of us these aren’t viable choices, but just as the finance minister wants government departments to cut fruitless and wasteful expenditure, careful consideration of how and where we spend our money might deliver some savings. Do we really need to drive the latest model car or shop in designer boutiques? Can we spend less on entertainment or eating out?

Sometimes these are hard decisions, but Marlies Kappers, chief marketing officer for financial services provider DirectAxis, says that if they look carefully at their monthly expenditure, most households can make some savings.

“It can be a daunting exercise, but it’s worth checking on what you’re spending your hard-earned money. You may be surprised at how much you save if you cut out some unnecessary expenses.”

Another thing to consider is your credit score. If the finance minister decides the country isn’t going to pay what it owes or behaves in a way that concerns international investors and lenders, global ratings agencies will downgrade the country.

The same thing applies to your household finances. If you behave irresponsibly taking on credit you can’t afford, make payments late or stop paying at all, it will reflect on your credit score. Ultimately this may make it more difficult, if not impossible to apply for credit, get a loan, a bond or car finance in the future. It could also mean you pay more interest.

“Your credit score tells people how financially reliable you are. A poor score limits your options, while a good score will enable you to access more financial opportunities,” says Marlies.

Ironically although news headlines regularly remind South Africans about how the ratings agencies view the country, most of its citizens have no idea what their personal credit scores are.

By law all South Africans are entitled to one free credit score a year, but most don’t bother to check.

To encourage more people to find out how they rate for credit and take better control of their finances, DirectAxis has designed an online credit rating tool called Pulse. It’s free and once registered, users can check their ratings as often as they want by visiting

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