It’s true, credit is given where credit is due

10 AUGUST 2023

Being debt-free can be a burden. Strange but true.It’s true, credit is given where credit is dueNot having debt is something many of us dream about. No more mill-stone of monthly payments weighing us down and relentlessly eating away at our hard-earned salaries. Must be nice. Or is it?

If managed well, having some debt is more helpful than harmful to you. Very few of us are going to be able to buy a house or a new car cash and will therefore have to rely on some form of credit to help secure the funds. However, without a good credit score you will not be able to access the money needed to make the purchase. But, and here’s the catch, if you have a (good) credit score, it not only makes it easier to secure the funds you need from a lender, it also puts you in a stronger bargaining position to negotiate the best possible interest rate for your purchase.


A credit score is a three-digit number that indicates how creditworthy you are. The number is determined through information gathered by credit bureaus and will inform the decisions of lenders to either offer you credit, or not, and also at what interest rates. A high credit score indicates a low risk and thus good credit terms, while a low score is considered high risk.

Managing credit effectively takes work and commitment. On the flip-side, not managing your credit well will cause you to have a bad credit score. This will adversely affect your financial prospects, resulting in financial institutions declining applications, whether for a home loan, personal loan or for vehicle financing. While it is better to have no score than a bad credit score, you will still be limited by what access you have to financial products, which ultimately limits your financial growth.


Nurture a good credit history

Having a store card or a credit card that you manage well shows credit providers that you are responsible and therefore trustworthy. This means they may be more likely to entrust you with additional credit.

Know your credit status at all times

Obtaining a credit score should not be a once-off thing. Keep an eye on it to ensure that all of your information is correct. It’s also important to take advantage of opportunities to improve your score. All of this will go a long way to ensuring that, should you need to apply for credit, you have peace-of-mind knowing that credit providers are seeing a well-managed credit history with no surprises.

Ensure you pay on time

Just like any relationship, keeping a promise builds trust. In the same way, if you’ve entered into a credit agreement, you have made a commitment to pay a set amount every month by a specific day. Doing so consistently will build trust with banks and credit providers, giving them greater peace-of-mind when having to decide to extend further credit to you. The opposite is also true. If you don’t pay accounts as promised it reflects badly and erodes confidence and trust.


Having a good credit score is something everyone can achieve. Yes, it takes work, commitment and discipline, but in the end the one who benefits is you. Seems like a no-brainer really.