From graduation gowns to credit scores: Your post-varsity financial survival guide

News24

13-06-2025

The transition from university to working life brings exciting opportunities but also financial challenges for many young South Africans. According to a 2024 1Life generational wealth youth survey, 50% of South African youth don't know how to build a financially stable future.
Basani Maluleke, Retail Bank Executive at Capitec, identifies this transition period as crucial for establishing long-term financial health, with credit scores playing a vital role.
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'Your credit score is more than just a number; it's your financial passport,' Maluleke explains. 'A good credit score can be the key to renting your first apartment without a big deposit, accessing affordable car finance to get you to your new job, securing favourable interest rates on loans, and even influencing your ability to get certain jobs or a cellphone contract.'
As Youth Month prompts reflection on these challenges, Maluleke offers three approaches to help graduates navigate this significant financial transition:
1. Income and budgeting: Your financial foundation
The cornerstone of financial stability begins with securing a consistent income stream—whether through formal employment, side hustles, or entrepreneurial ventures—and adopting disciplined spending habits.
'This financial foundation will protect you from falling into the trap of overspending when you get that first big financial break,' Maluleke advises.
She encourages creating realistic budgets and tracking expenses using tools like Capitec's Track Your Spend. 'Aim to save consistently, even in small amounts. This buffer prevents you from relying on credit for unexpected events, which could strain your finances if you struggle to repay.'
2. Understand and sidestep overcommitment
The temptation to immediately upgrade your lifestyle after receiving that first salary can lead many graduates into financial trouble.
'Overcommitment can quickly lead to missed payments or an unhealthy reliance on debt, both of which can severely damage your credit score,' she notes.
One common pitfall: 'We often see people deciding to rent a property or get a car that is more than 40% or 50% of that monthly income. Just because you can afford something doesn't mean you should buy it. It is also important to plan carefully for any payments required to support family members.'
3. Start small and smart with credit
To build a good credit score, it is important to use credit responsibly. Diving into large loans or high-limit credit cards without experience can be risky.
Maluleke advises that there are tools designed for those new to credit. She recommends looking for credit options that encourage responsible spending on small, everyday expenses, such as groceries or fuel.
'Users should aim to pay off the full balance on time to maintain a good credit record. This shows lenders that you're managing credit responsibly. Additionally, always take time to understand the interest rates, fees, and repayment terms – those details can make a big difference later,' she explains.
The financial world is always evolving, and Maluleke says young South Africans' knowledge should too. She encourages young people to seek out educational resources and review their credit reports regularly.