Getting out of the debt spiral

A debt spiral - where new debt is used to cover old debt, and the total keeps growing - can feel like there's no way out. There usually is, but it takes a clear plan and some support.

What it is

A debt spiral happens when someone borrows to cover existing debt or basic expenses, and the cost of that new borrowing adds to the pile, making the next month even harder. It often starts small: one missed payment, one short-term loan to bridge a gap. Over time, more and more income goes toward servicing debt rather than reducing it. This can happen to anyone, particularly during retrenchment, illness, or unexpected expenses. It is not a moral failing. It's a financial mechanism, and mechanisms can be interrupted.

Signs to notice

• Borrowing from one source to pay another
• Multiple loans or accounts, and losing track of the total owed
• Only ever able to pay the minimum, or missing payments
• Constant anxiety about calls or messages from creditors
• Feeling like there's no way the numbers will ever work out
• Using credit for everyday essentials like groceries or transport

What helps

• Stop borrowing to bridge gaps, even though it feels like the only option in the moment. Each new loan usually deepens the spiral.
• Get the full picture. List every debt, balance and interest rate in one place, however uncomfortable that is.
• Contact creditors directly. Many are willing to arrange a payment plan, especially before an account goes into default.
• Look into formal debt relief options like debt review, which can restructure your repayments into one affordable amount under legal protection.
• Cut off high-interest options like payday loans while you stabilise.
• Focus on covering essentials first - shelter, food, transport, utilities - before non-essential debt repayments.
• Be patient with yourself. Getting out of a spiral takes months, not days, and that's normal.

When to reach out for help

If you're using credit to buy groceries or pay for transport, if creditors are contacting you regularly, or if you feel panic every time your phone rings, it's time to get professional support. This is especially urgent if the stress is affecting your sleep, mood or sense of hope.

Getting help in South Africa

A registered debt counsellor can assess your situation and explain options like debt review under the National Credit Act. Cleared Mind's EAP counsellors are available to help you manage the emotional toll while you work through the practical steps, confidentially and at no cost.