A new survey by DebtBusters has confirmed what many South Africans already feel—middle-income earners are under growing financial pressure, even as the country shows signs of economic recovery.
New survey reveals eye-opening reality South Africa’s middle-class is surviving in
The Q1 2025 Debt Index, released this week, reveals that South Africans earning between R10,000 and R35,000 per month are having to cut back on basic needs just to keep up with debt repayments and rising living costs.
According to the report, this group—considered the backbone of the working class—is now spending less on essentials like transport, food, utilities, and vehicle maintenance.
This is not because these needs have become less important, but simply because there isn’t enough money to go around.
The Debt Index shows that while nominal incomes (the amount people earn without adjusting for inflation) have increased by 1% since 2016, the cost of living has climbed much faster.
In reality, consumers now have 30% less buying power than they did in 2016.
“This is a silent crisis that’s developing below the surface,” the report notes.
“People appear to be managing better on paper, but the truth is many are skipping essentials to survive.”
For example, the index found that:
- 40% of middle-income earners are now using more than half of their take-home pay just to service their debt.
- Unsecured debt levels (loans that are not backed by assets like houses or cars) are 23% higher than they were in 2016.
- Many are taking out personal loans just to stay on top of rising monthly bills.
While South Africa’s two-pot retirement system—which allows workers to access a portion of their retirement savings—has given some relief, it hasn’t solved the root problem. The report warns that using retirement funds to pay off short-term debt is only a temporary fix.
DebtBusters’ head of debt counselling, Benay Sager, said:
“The real challenge is the shrinking middle class. We are seeing more people come in with higher levels of debt and fewer options. This trend cannot continue without serious consequences for the economy.”
The survey concludes that although South African consumers appear more confident in their financial decisions, the reality for many is that day-to-day survival means making sacrifices that threaten their long-term stability.
