Debt counsellors kempton park

How Much is Too Much Debt?

Debt is not always a negative thing, even though we often tend to think of it that way. Having some debt can actually be quite healthy, as long as you are in control of your finances and can afford to pay it back in a reasonable amount of time.

Whenever you borrow money—from a bank, credit card company, or friend—you take on a debt. If you manage your debt wisely, it will improve your credit history which allows you to purchase and invest in important things (like a home) that you might not have otherwise been able to afford.

But taking on too much debt and feeling “in debt” financially, can be a problem. If your debt—not counting your home mortgage (investment)—exceeds 20 percent of your take home pay each month, you could be in over your head. Like many things, recognizing that you have a problem is the first step to solving it. Some of the warning signs that you may be in over your head include:

  • Regularly spending more than you earn
  • Skipping payments on some bills in order to pay others
  • Making only the minimum payment required on your credit cards
  • The credit limits on your credit cards are ‘maxed-out’
  • You’re receiving late payment notices or calls from collection agencies

Consequences of too much debt

Getting calls from creditors and dealing with overdue bills might cause anyone to lose sleep and develop stress—not to mention what it does to your credit score. Too much debt can:

  • Lower your credit score. Credit reporting agencies keep track of late and missed payments and how as how much money you have borrowed (nearly one third of your credit score is based on how much debt you have).
  • Limits your ability to get credit in the future. A low credit score can make it much more difficult—and more expensive—to borrow money in the future.
  • Cause stress. Worrying about how you are going to pay your bills can cause you to feel stressed, which can have a negative impact on your health and well-being.
  • Limits your choices. You may no longer be able to afford the things you like to have.
  • Creates a cycle of debt. When you’re in over your head and paying only the minimum amount due or even missing payments, you are adding additional interest and fees to your account and increasing your debt. It takes discipline and effort to get back on track.

Many people face financial crises some point in their lives. Whether it is caused by illness, job loss, or overspending, too much debt can feel overwhelming. No matter how dire your financial situation, there are things you can do to keep it from getting even worse.

Rule Number One: If you’re having difficulties making your monthly payments, call your creditors! Most companies are willing to work with you to find an acceptable payment plan—particularly if you are proactive and honest about the challenges you’re facing.

Contact Us



Physical address: no 296 Schoeman street, Prime Towers, office 211

2nd floor, Pretoria Cetral, 0001       

Phone: 087 808 9804

Fax: 086 639 5364       

Cell: 071 236 9988






Physical address :

no 87 commissioner street           

central Johannesburg 2000,

3rd floor

Phone: 087 808 9778

Cell 072 977 1236