Use this moment to cut debt and invest smarter
By Marise Reinach*
For years, South Africans have felt squeezed—higher food prices, rising fuel costs, and relentless interest rate hikes. Many families have been in survival mode, doing whatever it takes to keep up.
Now, with inflation easing and interest rates stabilising, you finally have breathing room. The question is: will you let that relief quietly disappear into daily spending—or will you use it to move forward?
From pressure to progress
When interest rates were high, many people had no choice but to manage as best they could. But now, with conditions shifting, you have the opportunity to move from reacting to planning.
Take a fresh look at your debt. Is that credit card really worth the R2,000 in monthly interest? What would it feel like to wipe that off your plate for good? Compare that to your home loan, which, while still a debt, often supports long-term value by building an asset.
Your income isn’t just a paycheck. It’s your most powerful financial tool. The less of it chained to repayments, the more freedom you have to save, invest, and make choices that shape your future.
Turn relief into momentum
Here’s where it gets practical. Inflation cools. Rates soften. Suddenly, your repayments are a few hundred rand lighter, or your grocery bill doesn’t spike as much as it used to. It may not feel like much, but that’s exactly why it matters. These small wins disappear quickly if you don’t use them on purpose.
Will you let that extra cash dissolve into daily spending? Or will you redirect it toward something more meaningful? Use it to pay off a credit card, boost your savings, or put more towards your long-term goals by topping up an investment. Each step you take builds momentum.
I’ve seen clients redirect as little as R500 a month into settling credit cards and become debt-free in 18 months. Others used the same breathing space to increase retirement contributions—and soon found themselves ahead of schedule.
Small steps, repeated consistently, build powerful momentum.
Reduce debt or invest?
Not all debt is created equal. Home loans usually carry lower interest rates and can support wealth creation. Others, like credit cards and personal loans, do the opposite. Knowing where to focus first depends on where your money can do the most good.
For example, settling high-interest debt is like locking in a guaranteed return. Paying off a loan that costs 20% a year is the same as earning a risk-free 20%. That’s hard to beat. Once expensive debt is under control, the trade-off between investing and reducing other debt becomes more nuanced.
If your bond costs 9% but your investments can earn 11%, investing may make sense—depending on how stable those returns are and whether you’ll need liquidity.
Here’s a way to think about it:
Certainty vs. potential: Paying off high-interest debt is a guaranteed return without risk. Investing offers more growth opportunities, but with risk.
Flexibility: Lower debt frees up cash flow. Depending on the type of investment, investments may be less accessible in the short term.
Your goals: If retirement, property purchases, or major life changes are on the horizon, reducing commitments could be more valuable than chasing higher returns.
This isn’t about a one-size-fits-all answer. It’s about aligning your choices with your goals, your risks, and your timeline.
Small changes, lasting impact
Lower inflation and easing interest rates are not a green light to spend more. They are an invitation to make your money work harder. Even modest shifts in how you use extra cash can make a meaningful difference over time.
You don’t need a full financial overhaul. Even modest changes—a bit extra toward debt, or a slightly larger debit order into your investments—can transform your long-term position.
The goal isn’t perfection. It’s progress, so when the next wave of economic pressure arrives, you’re not only ready but ahead.
Take the next step
Relief is here. The choice is yours. Will you let it slip away unnoticed, or will you use it to cut debt, invest smarter, and create financial freedom?
If you’re unsure where to start—whether to focus on reducing debt, increasing investments, or striking the right balance— that’s exactly where financial advice adds value.
Let’s turn this moment into your turning point.
*Marise Reinach, CFP®, is a head of Brenthurst Wealth Pretoria.
