AFTER a long December of overspending and poor money planning, people desperately short of cash will once again be beating a path to the doors of pawnbrokers and second-hand shops.
Debt rescue service providers said they saw a “dramatic” increase in the number of people requesting help at this time of year.
Tom Fuhri, CEO of the Second-hand Dealers & Pawn Board, said the problem was the long break between December and January salaries and that people did not plan properly or budget for their holidays.
“The people who end up in trouble in January, selling stuff, are the people who are spending money they don’t have.
“In December our shops are quiet because people go on holiday, but come January and February people find themselves in a difficult position and come in to sell goods. Usually it is the small things like electronics and jewellery,” he said.
Overspending and poor budgeting is nothing new, but Roy Peretz, a pawn-shop owner and second-hand dealer, said there was a simple way to avoid having to meet him in January.
“It is very simple. Don’t use credit. If you don’t have money, don’t spend. So, in other words, spend what you have,” said Peretz, owner of Cash Inn in Johannesburg.
He said it was very common for people to come into his shop after the holidays and sell or pawn valuable items.
“The poor sell the small things, while the rich sell the more valuable things,” Peretz said.
Neil Roets, CEO of Debt Rescue, said debt counsellors usually saw an increase in people approaching them for help in January.
“After the December holidays we see a dramatic increase in applications, because of overspending in that period,” said Roets.
“Many people max out their credit cards during the holidays and have no other means to cover their living expenses as well as repaying their debt instalments,” said Roets.
“Budgeting is the best solution to keep track of your spending. Once you know how your money is spent, it is easy to take corrective action.”