What is Budget Repair?
The Budget Repair process spans six months, allowing enough time for employees to change behaviours and build new habits. The process works as follows:
Octogen is a South African thought leader in progressive credit legislation, consumer spending and debt management. They were involved in the development of the country’s lauded National Credit Act legislation, so they know what they’re doing. Octogen’s innovative G Access digital assessment - which forms part of the Budget Repair solution - combines all this experience, with more than 15 years’ worth of consumer data, to offer your employees a quick, easy, digital way of accurately and honestly assessing their financial and debt situation. And with 6 months of personal coaching, helps employees and customers get back up to a sustainable budget.
Budget repair is comprised of the following elements: On-Point Technology (G Assist), Full Financial Assessment, Focused Education, One-on-one coaching.
If you would like to discuss the best way to provide Budget Repair to your employees, speak to your Old Mutual Corporate Consultant or let us call you back.
Take a look at some of the questions and answers below or email us at firstname.lastname@example.org.
Please note answers which are given are general in nature, and therefore do not constitute financial or other professional advice. The answers do not take into account your specific circumstances and should not be acted on without full understanding of your current situation and future goals and objectives by a qualified financial adviser.
The Budget Repair Service aims to help you to take control of your finances and plan to get out of debt or reduce debt prior to retirement in a structured way. With Budget Repair you understand your current spending profile, which can be used to amend your spending to create released affordability to repay debt faster. This not the Debt Review Service in terms of the National Credit Act.
Any new loan attracts interest, initiation fees and new monthly service fees. A consolidation loan is only beneficial if the total cost of the new loan is less than the sum of your current costs and interest, and you do not extend the repayment period. If you extend the repayment period, this may well increase the total cost over the period. This means from a cost point of view the consolidation loan may increase the cost which is not recommended.
It may be more cost effective to use your free cash flow to repay debt faster. Start with the lowest debt and increase your payment and when it is completely repaid, close the account and repeat the process.
Some Consumers use their home loan to consolidate debt. This may reduce your cost but do not extend the payment over the full term of your bond. If your loan repayment was, for instance, R2 500 it will be beneficial to settle the debt from your home loan but also increase your bond repayment by R2 500. This will repay the debt over a shorter period and result in a cost saving.
In order to get into the discipline of repaying debt it is recommended that the smallest debt be repaid first. The pleasure of repaying this debt and closing the account will be the inspiration needed to repeat the process.