Category Credit
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Women less likely to seek help for debt than men

05 August 2009 Consumer Assist

Women find it harder to admit to debt than men. Research by debt counsellors, Consumer Assist shows that when evaluating more than 20000 client files, men were far more likely to go for help than women.

“Close to 58% of clients are men - with white and black African men more likely to seek help than those of mixed race (coloured). Coloured men were half as likely to go for help as white men and a third less apply for debt counselling than African men. However, those of Asian origin are the least likely to seek help with only five percent of those on our books Asian men,” Andre Snyman, CEO of national debt counselling organisation, Consumer Assist said.

“White women are a third more likely to seek help when they are under financial stress than black African women, however, Coloured women, although they are less likely to seek help than black African women, follow not far behind. And Asian women are the least likely to seek help with only four percent of women requesting debt counselling being of Asian descent.”

Snyman said they had yet to delve further into the reasons for the differences in applications, “however, our debt counsellors have told us that single women, especially those who are single parents are more likely to apply for debt review. However, very many women are under debt review because they are married in community of property.

“The Asian community is very good about assisting each other either through relatives or religious organisations and this may be why fewer people from Asian communities come forward for assistance.

“What these figures tend to indicate however, is that far more awareness needs to be created in black communities about debt counselling and how it can work for them. White people apply for assistance in far greater numbers than their demographic profile would suggest. And too with 40% of children growing up in single parent households, usually with a mother and with high rates of maintenance defaulting, it is surprising that women are less likely to come forward for help than men.”

Snyman suggested that debt counselling campaigns needed to apply greater emphasis to education programmes in black communities and among women.

“August is women’s month and we at Consumer Assist will place particular emphasis on trying to educate women through financial wellness courses at companies and through our debt counselling branches on the importance of seeking help with debt before lawyers’ letters start arriving.

“We hear tragic examples of mothers not sending children to school because they cannot afford school fees or school uniforms, or houses being taken away from mothers because they have not been able to keep up bond repayments.

“I have one example of a couple that got divorced after being married in community of property. She did not change the ownership of the house as per the divorce agreement to show that she now owned the house. R264000 is owed on the house, but because the ex-husband is now in financial trouble creditors are trying to take away the house from her and her legal position is difficult because the house is still in both names.”

He said that one factor that might see married women less likely to come forward, “is that they often don’t want to reveal how over-spending or poor budgeting may have seen a crisis emerge with the family finances. Debt counsellors frequently have to mediate very heated discussions between spouses and often we will encourage them to go for marriage counselling while we are helping them to sort out problems around debt.”

Snyman said too that while many faith communities had attempted to help families meet financial shortfalls by providing groceries, assistance to pay light and water bills, school fees or rent, “many are becoming so overburdened by demands within their communities – and these range from the previously rich to the poor – that they too can no longer cope.”

He gives basic tips to assist those with financial difficulties to cope:

· Assess which credit and store cards charge the most interest. Pay the minimum necessary every month but on the highest interest rate card pay extra every month, even as little as R10 a month until it is fully paid up. Don’t close the credit card because that will negatively affect your credit rating. Use the same technique to pay off all cards.

· Get out of credit card debt before you open an investment account or savings plan.

· Never take loans to pay off debt especially consolidation loans.

· Paying bills on time creates a good credit record and this is often an employment criteria so in these difficult job seeking times, protect your credit reputation.

· You should have at least eight months salary in your savings account to counter the risk of losing your job, in today’s economy it will take a minimum of eight months to find a new job and maybe longer.

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