As we stay home to protect ourselves and our loved ones, it’s important that our finances are protected too! Maintaining a good credit score may be a little harder than normal at the moment, but if we can make small changes to our daily, weekly, and monthly financial decisions, the impact on our financial health will be small.
So, where do you start? You need a plan! Instead of just skipping payments, use this time to sit down with your finances – look at your bank statements, your salary and your financial commitments, then think of how the below four strategies can help you to protect your credit score.
- Regularly check your credit report
Even through tough times, it’s important to monitor your credit usage and payment habits! Your credit report can give you a clear picture of how well you are managing your finances. Download it for free here - it’s available to all South Africans. Checking your credit report can also help you to discover if you’ve been a victim of identity fraud. The earlier you spot this, the sooner you can contact the bureaus, fix the errors in your credit report, and stop money vanishing from your account.
- Talk to your bank/creditors
Retrenchments, short time and temporary unpaid leave, are the unfortunate realities many South Africans are dealing with as a result of Covid-19. If you’re worried about how you’re going to pay your next installment on your loan, it’s time to get in touch with your bank. At African Bank, we’re committed to giving our customers financial relief. By exploring options such as Credit Life Insurance, or Payment Breaks, you can keep up your monthly loan payments and safeguard your credit score.
- Make your minimum payments on your loans/credit cards
The best way to protect your credit score is to make sure that you pay your monthly loan instalments. When money is tight, however, paying these instalments will take a backseat to more pressing needs, like putting food on the table. If you’re in this situation, talk to your bank and make a payment arrangement. This will allow you to adjust your payment plan so that you can take care of your family during this difficult time.
- Create a budget to watch your spending
A watchful eye is better than an empty wallet! This is the most important time to practice making better decisions with money. Keep an eye on what are you are spending money on. Is it necessary? How can you spend less? Where can you save money? Draw up a budget — it forces you to be mindful of your spending. You will be surprised at how much you can save just by making a small change in your spending habits.