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How Much Do South Africans Need in 2026?

A new report based on research by the Living Wage South Africa Network suggests that a person working full time now needs to earn around R20,000 a month (after deductions) to enjoy a basic but dignified standard of living.

The research found that many people earning below R14,000 struggle to realistically meet ongoing every day needs, while those earning above R25,000 finally begin to enjoy some financial comfort. This is why they settled on a figure in between.

Now, R20 000 may be a higher figure than you were expecting to see.

This is because, due to inflation, in most economies, the price of goods and services doubles every 15 years. So, the prices you remember from your childhood will be quite outdated by the time you are in the workplace. They will be entirely outdated by the time you establish some seniority within your industry.

That’s just the nature of time and inflation.

Are We Setting Consumers Up to Fail?

For Debt Counsellors, this raises an important question.

Could well meaning Debt Counsellors be cutting budgets too close to the bone in order to ensure that credit providers will easily accept proposals?

After all, to offer lower proposal amounts will face pushback and can end up in lengthy, expensive legal battles instead of easy consent orders.

But, is that actually setting clients up to fail?

Every day Debt Counsellors work with consumers to draw up much more realistic household budgets to cut their spending but those budgets also need to last throughout a debt review process which often spans five years. So, they are today, working out what the person will need to survive in 4 or 5 years’ time.

Tricky.

Yet many of the spending norms still used across the industry in things like DCRS proposals can be traced back to guidance developed by an industry task team more than 15 years ago. Since then, food prices, transport costs, utilities, education and many other everyday expenses have increased dramatically. Eskom’s electricity prices are a very good example of higher than expected increases.

Is It Time to Review Things Based on Current Realities?

Perhaps it is time for all industry stakeholders to revisit these benchmarks.

We could ask: Should we all be doing proposals over longer time periods to allow for more realistic monthly budgets?

After all many credit providers are now offering credit over longer time periods knowing that it will take consumers longer than before to repay those types of credit (E.g. Large personal loans and vehicle finance).

After all, debt review only works when repayment plans are both affordable and sustainable.

If consumers are expected to survive on budgets that no longer reflect the true cost of living, they may be set up to struggle rather than succeed. Updating such dated guidelines (for example in the NCR Task Team 2.0) could help ensure debt review continues to offer consumers a realistic path to becoming debt free rather than one they are doomed to crash out of after 36 months.