Actionable Debt Repayment Strategies
Ruvan J Grobler • September 1, 2025
Debt is often used in case of emergencies but can also be used as leverage to finance the purchase of assets that would otherwise be out of reach. In the case of good- and bad debt, the repayment strategy will help manage cashflow and lower the costs of borrowing. The aim of this article is to help you pay of good debt earlier but may also help those individuals who are under pressure due to debt, to take control of the situation.
It is important firstly to have a comprehensive budget that gives a framework for your spending. This helps you keep track of your cashflow and discourages your emotions from taking over. Before taking out any debt, emergency funds and insurance must form part of your plan. Avoid taking out new debt if it does not fit into the current plan and budget.
Why it’s important to have a structured plan for repaying debt:
- Paying more interest over time: Only paying “what you can, when you can,” your payments might be too small or irregular. The debt repayment takes too long, and you pay more in interest.
- No clear end date: A plan lets you see exactly when you’ll be debt-free, which can be motivating and helps you track progress.
- Poor prioritisation: Not all debts cost the same. A structured plan ensures you pay off high-interest or priority debts first.
- Easier budgeting: Knowing exactly how much you’ll pay each month helps you manage cash flow and identify opportunities for extra repayments.
- Better discipline and accountability: A structures plan helps to remove any guesswork and prevents emotional spending or skipping of any payments.
Repayment Strategies:
Snowball Method
- How it works: List debts from smallest to largest balance. Pay minimums on all and put any extra money into smallest debts first.
- Positive: Quick wins from paying off small debts early give motivation to keep going.
- Negative: You might pay more interest over time compared to other methods.
Avalanche Method
- How it works: List debts by interest rate, highest first. Pay minimums on all and put extra money toward the highest-interest debt.
- Positive: Saves the most on interest and often pays off debt faster overall.
- Negative: May take longer to see your first “win,” which can be demotivating for some.
Debt Consolidation
- How it works: Combine multiple debts into a single loan (often at a lower interest rate). This could be a personal loan, balance transfer credit card, or home equity loan.
- Positive: Simplifies payments into one bill and can reduce interest costs.
- Negative: If you keep borrowing after consolidating, you could end up in deeper debt.
Refinancing
- How it works: Replace an existing loan (e.g., bond, car loan) with a new one at better terms.
- Positive: Can lower monthly repayments and interest.
- Negative: Extending the term may cost more in interest over the long run.
Ruvan J Grobler RFP™ (PGDip Financial Planning)
I recently signed up for one of my bucket list items, the demanding Comrades Marathon. It’s something that I always had in the back of my mind, and I said to myself that if I ever where to take on the 87km beast, I am going to be prepared. So, as I successfully entered and received my number, I immediately did 2 things: 1) I got a coach: Someone who is experience and can guide me week by week, month by month leading up to the Ultra Marathon 2) I got a training partner : After using all my persuasion skills, I convinced a friend to join me on this journey. Not only for the comradery, but more as an accountability partner, to make sure I show up for training even though I might not feel like it For many of us, we want to make sure 2026 is our best year yet, not just physically, but financially as well. How can we be more productive and make more money or at least manage it better? In his Book Atomic Habit, James clear writes about the ‘Commitment device’ in chapter 14. A Commitment device, also referred to as the ‘ Ulysses pact’ is a choice you make in the present, that controls your actions in the future. It is a way to lock in future behaviour, bind you to good habits and restrict you from the bad ones. Some examples include: - Eating out of smaller plates – to limit calorie intake. - Unsubscribe to emails and apps – to waste less time - Setting up an outlet timer, to cut off the Wi-Fi at 9pm per night - to limit social media or series binging. - Keep your phone in another room when working – to avoid distractions When it comes to your finances here are a couple of things you can try to make 2026 you most financially rewarding year yet. - Automate your investments: Remove the temptation to spend your money by setting up debit order for the money to be invested as soon as it hits your bank account - Appoint a financial partner – this can be an advisor, friend or spouse: his person must be strict and diligent and keep you to your goals. Schedule quarterly calls to go through your investment accounts to see how much it has grown - Buy groceries only twice a week: We almost always buy things we don’t need – limit your number of visits to the store - Let you partner hide your credit card during the week and have an x amount of cash available. This might sound harsh but can be extremely effective as we swipe or tab often without thinking. There’s so many examples of how we can adjust our behaviour by setting up ‘ Commitment devices. I’d like to hear your favourites so please send them through to geo@bovest.co.za and let’s help each other to make 2026 memorable and profitable. Geo Botha CFP® Marketing Director
Dearest clients and colleagues. While I was contemplating about this month’s topic, I felt led to share the following testimony with all of you. I really hope it will encourage you and call you to action. Before I begin, I am sure you will get enough information about the markets and politics from my colleagues, so I am happy to divert and continue my story. Just a bit of background. I have been on diamond Vitality status with Discovery for many years. I have faithfully done my yearly check ups every year and also the specific tests that Discovery requests. I slipped up after Covid with my mammogram and pap smear and I didn’t know I had to do a colonoscopy. Just before my birthday in July, I had severe stomach pain. I am not a person who likes to visit a doctor but here I certainly learned a lesson. If you have pain, your body is telling you there is something wrong, so don’t be tough, just go and check it out. I was diagnosed with colon cancer. EVERYTHING changes in an instant. The way you look at life, your values, how you see people, your relationship with your Creator and Saviour. Everything happened so fast and I had to go in for major surgery. After 10 days in ICU, fighting for my life and a couple more days in the surgical ward, I was discharged. So many things were going through my mind. Will I see Christmas again? Will I ever be strong enough to enjoy life again? Will I see my children and grandchildren again? Will I have to go for chemotherapy and radiation? Doubt and fear started to slowly enter my mind. The battle is in the mind. Then breakthrough! My tests came back and I was clear. No cancer in my body. Surgery was successful. Oncologist was happy. I do have to be monitored regularly, but praise God? Here I must elaborate. I have a strong support group who carried me in prayer. I have faith in our Almighty God who still heals today. Bovest as a company also supported me phenomenally. Thank you to all 🙏 My message for all of you is the following: please go to the doctor if you have pain or discomfort. Please do your mammogram, pap smear, prostate and colonoscopy tests regularly. Prostate test now is just a blood test. Please make sure your severe illness and income protection cover is in place. You really need it. Speak to your advisor about it. Don’t be like an ostrich, prevention is far better than cure. Surround yourself with positive people. Spend time in the Word. It is alive and it is healing to your body, soul and spirit. You are welcome to reach out to me anytime. May you have an amazing 2026 and please look after yourself. Kind regards Yvonne
