The Reality of Household Debt in Namibia

Simba and Sibo are a young married couple living in Windhoek, the bustling capital city of Namibia. They were overjoyed when they were approved for a loan to buy their dream home, a spacious four-bedroom house. However, they soon found that the monthly mortgage payment, along with other bills and expenses, was too much for them to handle. They started using credit cards to make ends meet and soon found themselves deep in debt.

Simba and Sibo's story is not unique. Many Namibian households are facing similar struggles with debt. According to a report by the Bank of Namibia, household debt in the country has been steadily rising over the past few years. In fact, the debt-to-income ratio for Namibia is one of the highest in Africa.

Concrete Examples

• Average household debt in Namibia is around N$150,000
• In 2019, more than 50% of loans granted by commercial banks were used for consumption purposes
• Namibians spend around 13% of their income on debt repayment

The realities of household debt in Namibia are alarming, but there are ways to avoid falling into the debt trap. Here are three important points to keep in mind:

1. Create a budget and stick to it. Know exactly where your money is going each month and make a plan to pay off debt.
2. Be mindful of spending. Avoid using credit cards for non-essential purchases and limit your spending on entertainment and eating out.
3. Consider getting help from a financial advisor. They can help you develop a plan to pay off debt and achieve financial freedom.