As the festive season approaches, financial experts are warning that many South African households will struggle to cope with the economic fallout that follows Christmas and New Year celebrations.
It is explained that December spending typically surges as families stretch their budgets on gifts, travel, food, and entertainment, often forgetting that the month’s salary has to last well into January.
The pressure is amplified as most South Africans head into the biggest spending period of the year already financially stretched, and experts say the strain is showing up in their mental health.
René Moonsamy, Chairperson of the National Debt Counselling Association (NDCA), tells the Saturday Star that the outcome is predictable and increasingly severe.
“By January, substantial expenses for going back to work and going back to school kick in, and families face a real financial crunch,” Moonsamy said.
From school fees and uniforms to transport costs, insurance increases, and medical aid adjustments, January hits especially hard for parents.
Debt counselling stakeholders report a clear pattern each year: consumers take out more credit in December, and by late January or February, they seek additional loans to close widening financial gaps.
“December spikes revolving credit usage, like store cards and credit cards. In January/February we see spikes in borrowing or attempts to get loans/further credit,” Moonsamy said.
“We survive December’s expenses and go straight into January, which has the most substantial expenses and is perhaps the costliest month if you have kids,” she explained.
“For many households, these costs wipe out whatever is left of December earnings.”
Moonsamy highlights that ongoing financial pressure is closely linked to stress, anxiety, and even depression.
“When households are unable to meet their obligations, it creates a constant sense of worry and insecurity. This financial stress can exacerbate mental health challenges, particularly for families already stretched thin,” she said.
Short-term borrowing may provide temporary relief, but it often compounds anxiety as repayments mount.
JJ van Wyk, Financial Adviser at Momentum Financial Planning, also emphasises the strong connection between debt and mental health.
“A significant link is often observed between one’s financial situation and their mental well-being. Individuals experiencing problem debt are more likely to also report mental health difficulties. Financial difficulty can trigger stress and anxiety, which may lead to or worsen mental health issues. These difficulties can then make it harder to manage money, maintain income, and seek assistance, potentially creating a cycle that intensifies the financial strain.”
He added that persistent unsecured debt creates a heavy psychological burden.
“Conversely, the presence of persistent unsecured debt creates a crushing psychological burden. It is strongly associated with a higher incidence of depression, anxiety, and even suicide. Individuals struggling with debt are up to three times more likely to experience a mental health condition. The stress of debt can affect sleep, concentration, and relationships, creating a vicious cycle where poor mental health makes sound financial decisions even more challenging.”
Saturday Star