Financial Wellness

How do I get out of ‘zero nett pay’?

Lesego* is very worried. She’s experiencing a real crisis with her money situation. She’s got a good job in Gaborone, but her employer is garnishing too much of her wages.

Lesego pays the following monthly expenses out of her salary before receiving any money:

1. Cash loan repayment

2. Furniture store repayment

3. Bank personal loan

4. Medical Aid

5. Funeral Cover

6. Legal expenses insurance

7. Tax - PAYE

After all of these deductions she’s now left with less than P200 a month.  With this remaining money she still has to cover all of her monthly expenses – food, transport, lights and water – plus school fees for her daughter.

Lesego doesn’t afford luxuries like visits to the salon. She doesn’t even have a social life. Those days are long gone.


As the month passes, the stress on Lesego gets greater and greater. She’s thinking about how to find the money for food for her daughter for dinner tonight. Thinking about how she will get to work tomorrow. Worrying emotions fill her day, leaving no time focus on anything else.

Lesego is getting close to experiencing what is known as “Zero Nett Pay” – not receiving anything at month-end.

What can Lesego do about her situation?

The first thing that’s obvious is Lesego needs urgent help. She’s not going to be able to tackle this on her own.

To get help, she must acknowledge that she needs help and then seek it. If Lesego waits quietly hoping and praying that something will happen ‘out of the blue’ to fix her situation, it is likely to get worse.

Lesego can’t just hope for a miracle, pray for a windfall, or expect to win at the casino. She has to actively try to fix her situation.


We often feel very ashamed when we’ve made some bad decisions. We think that our friends and family will criticise us, think badly of us, and won’t like us anymore. That’s why so many of us aren’t honest about our money situation.

Being ashamed, leads us to not being honest with our own selves. It’s worrying to write down all our debts, and makes us feel uncomfortable. We’d rather stick our head in the sand until we forget about it.

But it’s ignoring the problems that has got Lesego into this situation in the first place. She has to face up to reality.


The first step

The first step for Lesego is to write down, in private, all her debts, all her monthly outgoings and compare it to her income.

That allows her to take stock of the situation – to realise the scale of the problem, and start to think about realistic options.


Cutting back on expenses

Once all your expenses are written down, you can look at prioritising the payments. Are you on the right medical aid scheme? Do you need funeral cover when you’re young? Do you need to pay for legal insurance? Are you spending money at the weekend just to cheer yourself up?

Lesego realises that her main problem is her debts – she’s bought things that she couldn’t afford before, and she’s paying for them now – out of the money she and her daughter need to live.

Who can help?

There are a few options that she can turn to for help and advice – there are financial advisers, debt counsellors, financial wellness educators. Just make sure that you know what’s in it for them – you don’t want to be sold another policy or a bad loan.


Your employer

Remember, your boss isn’t your bank. It isn’t your company’s role to give you loans. However, someone at work might be in a position to advise you on the right steps to take. If you’ve got a good relationship with your boss or your HR manager, talk to them confidentially about your worries.

For Lesego, she knows that money stress is already taking too much out of her focus at work.  If she talks to her employer she should have an idea about some solutions to her problems before asking for their support.


How to get out of debt?

If you’re serious about getting out of debt, get ready to commit yourself to the hard work it will take for you to gain financial freedom. You need to take the following two steps: first educate yourself about money and then seek assistance in the form of counselling.


Financial wellness education

It’s important to know and understand the rules of money. You must learn some basic life skills in order to manage your own finances.

Without these tools even the highest earners are easily mislead down the path of debt and unwise investments.  You can ask your employer to provide this type of training to you and your fellow staff members.


Debt counselling

If you’re in a Zero Net Pay situation, you may need some personalised assistance to help you get out of debt and onto the road of recovery. That could come from a debt counsellor:

A debt counsellor will look at your whole financial situation, analyse your debts and propose a step by step solution. If you agree, you sign a binding contract to stick to the terms of the solution - so you are not mislead off the path again.

Something a debt counsellor might be able to do is negotiate a consolidating loan with a loan provider; usually a bank. They’ll then (for a fee) help you pay off all your other debts, so that you then have only one loan to pay, usually at a lower rate of interest and over a longer payment period.

This means that you’ll pay a smaller repayment each month. As long as you don’t take on any more debt, this could give you back some money to live on in your monthly salary.

Beware the T & C’s

Lesego must ask all the questions that she can think of before she signs any contract. We know that she’s getting desperate – but she needs to make sure she knows exactly how much it will cost her and how much she will be asked to pay. Remember, bad people often prey on desperate people in bad situations. Talk it over with someone you trust before making a decision.


Author: Lechedzani Pitso – Financial Wellness Trainer and Debt Counsellor

© S.C.I. Training run financial wellness programmes in Botswana. For help and information contact them on 3180243 sms 72309718 or email [email protected]

* Names in this article have been changed

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