Pretoria – KwaZulu-Natal Finance MEC Ina Cronjé has called on university students to improve their spending habits to avoid entering the labour market deep in debt.
Speaking at a workshop on financial education for government bursary holders and students at the Durban University of Technology on Tuesday, Cronjé said student debt has more than doubled in the past three years, and added that it was up to them to keep their spending under control while they were still young.
This comes after media reports that a large number of students had admitted to owning a credit card, raising fresh concerns that young people committed to debt and got black-listed long before they start working.
“Financial stress can threaten a student’s chances of succeeding at university.
“You can never be free if you are haunted by debtors and poor credit records.
“Relying on friends, family and government to stay alive does not mean freedom. The road to financial freedom is to get rid of debt and start saving and investing to build your own wealth,” Cronjé said.
Quoting the latest report by youth marketing company, Student Village and Unisa’s department of marketing and retail management, she mentioned that student debt has more than doubled in the past three years, with 20% of students admitting to owning a credit card in the 2012 survey, compared to 9.5% in 2010.
Nearly a quarter of students are in debt, most of it through retail clothing.
While urging students to get their finances in order and start saving for a better future, Cronjé also questioned some retail stores and banks’ ethical behaviour, who “give credit to students, whose only ‘income’ very often is allowances from their parents or bursaries from government and private companies”.
“They should actually be checking the students’ backgrounds before offering them credit,” she said.
“Financial institutions and government will not recruit you in a position that requires trust, honesty and entails handling of cash or finances if you don’t have a clean credit report. With good reason: we want to protect ourselves and our clients from possible theft. When one is in financial trouble, it becomes very tempting to put your fingers in the till,” Cronjé said.
The workshop was attended by 300 students, who were taken through lessons on healthy spending habits and learning the fundamental principles of acquiring wealth. – SAnews.gov.za
