Young, Black, Employed & Heavily Indebted

June is the month we dedicate to our youth. So I finally summoned the courage to write about the state of our youth and their money. In my work, I talk to many people about money, young and old. I am picking up a very disturbing trend among our younger brothers and sisters, i.e. heavy indebtedness. It feels like every 2nd person I speak to is burdened with heavy debt. Young people are complaining about how hard life is yet some don’t even have kids yet! I would feel a little better if they got into good debt but what concerns me even more is that most are heavily indebted over trivial staff e.g. clothing accounts, expensive cars, credit card debt, personal loans, furniture accounts, etc…

Meet 29 year old Mpho*. At face value, Mpho has everything he needs. His balance sheet tells a different story though as he is heavily indebted and has no savings and investments. He only started working some 7 years ago but already, he has worked for 4 different companies. Mpho is well qualified so he doesn’t struggle to get good jobs. As I listened to him, it was clear to me that he would work at a place for a while, run up debts and then leave. He would cash a little bit of pension he has to pay his debts. He will then start over again and run up a new set of debts and the cycle will start all over again. He is definitely one of the worse cases I have come across.

There are many reasons why people run up debts and I will not get into any of them. I am pleased to report that there are now a few that are making the necessary lifestyle changes to live within their means. Nothing is more pleasing than an email from someone who tells me he / she read my book and has drawn a plan to get out of debt or is already out of debt. One lady wrote to me to tell me her mother decided to sell her big car after reading my book. Some are already investing a little bit of what they earn. What stands out for me is the fact that we go through high school and university and no one teaches us about managing money. It is an indictment of our education system that we produce engineers, doctors, lawyers, nurses, teachers and other professionals who have no knowledge of personal finances. This lack of personal finance education is one of the major reasons we have so many young people who are so heavily indebted. Many would be well on their way to financial independence if they had the right information from the word go. Many start off badly and when they come across my book, they then make amendments and improve their finances. It would be so much easier if they had the right information from the beginning because it takes a long time to clear debts and to start over.

Below are just a few concepts I wish every adult knew before they start working:

  • Why credit life is a waste of your money – this is one product that is bought by those who don’t have much financial knowledge.
  • Why a personal loan is likely to make you personally poor – why it is so easy to get a personal loan & everywhere you look, someone is trying to sell you a personal loan. Try getting a home loan, you will see….
  • The opportunity cost of buying a car you cannot afford on residual.
  • Why a credit card is not for you if you don’t have self – control.
  • Investing money in the JSE.
  • Why investing money while you are heavily indebted is a waste of your money.
  • Why putting R500 away in a unit trust based retirement annuity is the best thing you could do for yourself – if you do this from your very first salary, you are likely to be part of the 6% that will retire comfortably.

I have addressed the above in the book From Debt to Riches. But there is a lot more that you need to know about money if you want to be financially independent. No one should care more about your financial health than you so if you want to be financially healthy, get yourself financial knowledge.

Please note that I don’t do debt consultations. I have shared enough pointers in the book From Debt to Riches and also in my Blog I have an article entitled The Debt Cancellation Plan. Many people write to me to say they are now out of debt because they read the book and applied my recommendations. I suggest you do the same or see a debt counselor.

If you want me to help you invest your money, contact me on

Do you know how we can help our young people get out of debt? Please let me have your views.


Should I send my kids to a private school or to a public school? – Some of your responses

Dear Phumi,

Thank You for your advice, this email is received at the right time, just when I was thinking about whether to send my child to a private or public school.

Thank You once again for empowering us with good information 




Hi Phumelele

This is in response to your topic, all the points that you have mentioned are facts and true,  some cases are not a choice, but what your kid needs, I didn’t choose a private school for my boys but I guess it chose me, Musa* has been at a private remedial school for the past seven years. It is a school for children with learning difficulties, he has a speech and language problem, when I was told about his issues I was young and he was my first born, so I took all the advice I was given at that time and took him for assessments and yes he needed that school, and as a  mum I had to sacrifice a lot over the years to pay his fees, not because I’m rich, but I wanted my boy to reach  his full potential in life, and I fully believe that if you tackle problems early in life, it’s easy to resolve them, than in later stages.

Then I had his younger brother, the guilt, of having one child in a private school and another one in a public school kills you, so yes both of them ended up in a private sector, and today I don’t regret my decision, Musa has grown so much and is ready to face the mainstream sector, he is confident, happy and a disciple child, who understands that he is intelligent as well, but has to tackle life in a different way.  I have applied to 3 public schools and 1 private school for high school with the hope that, he will go to a good public school, and I didn’t choose them because they are cheaper, but because they are  good schools and I believe he will be happy there because of the sports. If I had to take him to a private school because of his needs, trust me, I would  sacrifice another 5 years of high school for him.

So no regrets for the sacrifices I made for my boys, and after all its not a life time thing, kids grow out of school.

Thank you Zodwa*


Dear Phume

I sent your email to my kids who are also young parents and this is what they had to say 

Thanks mom… this is really great insight… Pertunia* always says this, and I always disagree because I also think private schools are the best.


Hi I just wanted to comment on your article, I agree with you and being a parent myself of three boys I know how much one should invest in teaching our kids at home. Personally being involved in my kids’ education has helped me to be aware when they are struggling and look for ways to assist them either through extra lessons and so forth. I am a product of the bantu education but I have done well and I believe that my parents played an important role in helping me complete my studies. From a young age I knew their expectation of me and my dreams where to some extent shaped/influenced by that expectation.




Hi there !

I Love it !

Big car or school ? 




Good day Phumelele,

Very interesting newsletter and for many this must be very scary. You touch on all the important points re the pro’s and the con’s. From the cost perspective you left out pre-schooling and also the benefit of pre-schooling in the overall success of your child. Children who attend two years of pre-schooling will start their school career on a much better footing than those who have not. The problem is that it cost a LOT of money.

Your last two points is actually the most important lesson  (1.The education of our children is a joint effort between the school and us as parents. We must still be actively involved in the education of our children to maximise the chances of a happy and successful school life. 2. An expensive private school education is no guarantee for a successful career.)

Unfortunately many parents don’t (or don’t want to) understand the “joint effort” bit and their responsibility in this relationship. Our public schools can all be supper performers if parents are prepared to get involved in the schools of their children and get involved in the education of their children. This is one of the most important points that differentiate schools, schools where parents accept the “joint effort” bit are the schools where your child will be successfully educated. And think about it, some commitment and a couple of hours are much, much cheaper than paying R80k to a private schools with no guarantee for success……

All of the best


*Please note that names have been changed to protect the confidentiality of the people involved

Debt to Riches cover






The book is available at Adams bookshops, CNA and Exclusives bookshops for only R134. Invite Phumelele to address your staff for Women’s Day or Staff Wellness Day about all things money. Drop an email to

Warm regards


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