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Are You in the Danger Zone? Why South Africans Are Stuck in a Debt Trap

Published

2 months ago

July 22, 2025

Chiraag

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The numbers are in, and they are scary. If you are feeling financially exhausted this year, you are not imagining it. According to a massive 2025 survey by DebtBusters, 63 percent of South African households are in what experts call the “danger zone” when it comes to debt, meaning they are spending more than 30 to 40 percent of their take-home income just to service what they owe.

And it gets worse. Almost half of households, 48 percent, are spending over 40 percent of their income on debt repayments. That is beyond what financial experts consider sustainable. In fact, anything above 50 percent is classified as critically unsustainable.

The Weight of Debt Is Changing How People Live

This is not just about money; it is about mindset. Debt is no longer a crisis to be solved. It is becoming a way of life.

The DebtBusters 2025 Money Stress Tracker, which surveyed over 27,000 South Africans, found that many households have started to normalise high debt levels. Nearly two-thirds of respondents believe their debt is not worse than that of their peers, even when the numbers show otherwise. This psychological shift, which experts refer to as “desensitisation to debt,” means fewer people are taking action to get out of debt.

And that is where the real risk lies.

The Crisis Feels Personal and Generational

If you are aged between 25 and 44 and earning in the lower income brackets, you are more likely to be struggling. Debt stress is most common in these groups.

This issue is not limited to one region. While Western Cape households are now the most concerned about their finances, overtaking Gauteng, stress levels remain high across all provinces, especially in Gauteng, the Western Cape, and KwaZulu-Natal.

On a positive note, the number of people panicking about running out of money is lower than it was in 2022. This shows some level of adjustment. However, nearly 40 percent of respondents still say they cannot keep up with monthly debt repayments, a figure that has actually increased since 2022.

Why So Many People Feel Stuck

DebtBusters found something particularly troubling: South Africans are taking fewer steps to improve their financial situations.

Compared to 2024, there has been:

A 10 percent drop in people cutting back on expenses or sticking to a budget
A 13 percent drop in those trying to increase their income, whether through job changes, side hustles, or selling possessions

This is not because people do not care. It is because many have simply run out of options or feel like they have. About one-third of people say they feel stuck, with no clear path forward.

In essence, South Africans are becoming what the report calls “stun-locked” into debt. It is not denial. It is exhaustion.

But There Is Some Light on the Horizon

Despite the doom and gloom, the survey did find some hopeful signs. People may be stuck, but they have not given up entirely.

In recent years, many turned to debt counselling, better jobs, or side hustles to manage pressure. In 2025, a new shift is emerging: a growing number of people are focusing on entrepreneurship, multiple income streams, and self-reliance.

This change in mindset could be key to escaping the danger zone. It may not happen overnight, but it can start to happen gradually.

The Bottom Line

South Africans are under heavy financial pressure. That much is clear. What is becoming more dangerous, however, is how normal this pressure feels.

If you are spending nearly half your income on debt, you are not alone, but that does not mean it is sustainable. The danger zone is not just a number. It is a trap. And the hardest part is not getting out. It is realising you are in it.

Now more than ever, the focus needs to shift from survival to strategy. From denial to taking action. Because the sooner we stop accepting debt as normal, the sooner we begin reclaiming control.