R50,000 salary, but still broke: SA high earners drown in debt

In South Africa, those earning more than R50,000 per month are grappling with a hefty debt burden, according to the latest DebtBusters Q2 2026 Debt Index. These high earners require 103% of their monthly income to cover their debt, while the total debt constitutes 307% of their annual net income. Unsecured debt has surged 84% since 2021, while the average size of unsecured loans has grown significantly, even as the number of loans has declined.

Benay Sager, executive head of DebtBusters, noted that larger unsecured loans are now being granted to a smaller group of consumers, concentrating credit risk. While lending to lower-income consumers has decreased, particularly post-pandemic, banks remain the primary source of credit at around 65%. Higher-income consumers carry a different debt mix, with 59% of their debt being asset-based, such as vehicle finance and home loans, and the remaining unsecured, including personal loans, credit cards, overdrafts, and retail accounts.

The cost of living pressures, including petrol prices up 52% and electricity tariffs up 101%, outpace income growth of 23% since 2021, straining household budgets. This financial strain has led to increased reliance on unsecured credit, with 96% of new applicants having a personal loan at application and 63% carrying a one-month loan – a record.

The average number of credit agreements per new applicant has reached 8.7, the highest since 2016, indicating a surge in multi-lender borrowing. The pressure is particularly acute among those earning between R10,000 and R20,000 per month, as almost a third of their disposable income goes to food, leaving little room for insurance, savings, or emergencies.