Your salary can be finished before you even spend a cent. Not literally. The money may still be sitting in the account. But, by the time payday arrives, much of it already belongs to decisions made days, months or even years ago.
The bank wants its instalment. School fees are due. The stokvel expects its round. Your sister needs help with a funeral contribution. The car has developed the sort of noise that becomes more expensive the longer you pretend not to hear it. Retirement, patient as ever, waits quietly at the bottom of the list.
Nothing on that list is frivolous. Every claim is reasonable. Together, they create a problem because when E15 000 of income meets E18 000 of legitimate obligations, the difficulty is no longer deciding whether these things matter. They do. The financial decision is deciding which one matters first.
For the past few editions of this column, we have spent considerable time looking at debt, first government’s, then the borrowing habits of households and businesses. We asked what borrowed money builds, what repayments take away and what remains when the loan is gone. This week, we move a step backwards. Before some debt appears on a balance sheet, another financial decision has already been made: when there was not enough money for everything, what did we choose to fund and what did we borrow rather than postpone?
No budgeting technique turns E15 000 into E18 000. That E3 000 difference has to go somewhere. An expense can be reduced. Something can wait. Savings can be used. An asset can be sold. More income can somehow be found. Or somebody else’s money can fill the difference.
Borrow E3 000 and for a moment, the problem appears solved. Everybody can still receive their yes. Except the E3 000 did not disappear. It travelled. Next month’s salary now arrives with a claim already attached to it. Add interest and fees and tomorrow may surrender more than the amount today refused to give up.
The scale of this is already visible in the national numbers. The Central Bank of Eswatini’s latest Financial Stability Report, presented in December, puts the household debt-service-to-income ratio at around 34 percent as at June 2025.
On average, roughly a third of household income is claimed by debt repayments before food, transport or school fees enter the conversation. That sits at the very 33% debt-to-income threshold the bank itself treats as the marker of financial strain.
Watching how much of your income goes to servicing debt is a good way to notice early that things are about to go wrong. Not all borrowing comes from poor choices. Low incomes, emergencies and unexpected expenses are real, and sometimes credit is the only practical bridge available. But sometimes borrowing is simply a financial decision postponed. We could not decide what had to wait today, so we asked tomorrow to decide for us. With interest.
Nor does that pressure fall evenly. Between September 2020 and June 2024, the share of housing loans in arrears rose from 5.6% to 9.6%, while arrears on unsecured personal loans stayed at around four to five percent and ended lower than they began. That runs against custom. Emaswati would traditionally defend the home before any other obligation. The debt-service ratio has stayed fairly steady over the same years. The strain has found its expression in the housing book instead, in the choice of which instalment waits. The prioritisation itself is in question.
EVERY YES CONTAINS A NO
This is the part of personal finance that bank statements rarely explain. Every lilangeni can perform only one job at a time. Put E2 000 towards a funeral contribution and that E2 000 cannot simultaneously reduce your loan balance. Put it into the loan and it cannot simultaneously enter your retirement fund. Put it into retirement and it cannot repair the car.
Economists call this opportunity cost. In ordinary life, it simply means that every financial yes contains a no. The danger is assuming that because the no was never spoken, it does not exist. It does. Sometimes it appears months later. A household empties its emergency savings for something important. Nothing seems wrong until an actual emergency arrives.
A person commits more of the salary to instalments. The purchases may all be affordable individually, but eventually payday arrives with most of the money already promised. Two people can earn exactly E15 000. One has E6 000 committed before the month begins. The other has E13 000. Their incomes are identical. Their financial freedom is not.
That difference is worth understanding because financial strength lives partly in how much money you earn or own, and partly in how much of tomorrow you have not yet promised away.
LOUDEST BILL NOT ALWAYS FIRST
This complicates the usual advice to simply ‘rank your priorities’. A list is useful, but finance runs on several clocks. Retirement may be enormously important but will not telephone you tomorrow morning. A high-interest debt can become more expensive while you delay it. Food cannot wait for retirement.
Insurance can feel less urgent than all three, until the day something happens and the protection you allowed to lapse is suddenly worth far more than the premium you saved.
So ‘what matters most?’ is a useful question, but it needs a companion: what happens if I do not pay this now? That changes the conversation. One unpaid bill may cost a late fee. Another may accumulate expensive interest. Another could interrupt an essential service. Another may damage your ability to earn. Another might have almost no visible consequence today while creating a serious problem 20 years from now. A good financial ranking therefore has to consider importance, urgency and consequence. That is capital allocation stripped of its boardroom language. You are deciding where limited money protects the greatest value.
SAME DECISION WALKS INTO A BUSINESS
Now leave the household and walk into a small business. The numbers acquire more zeros. The problem does not disappear. Imagine an SME receives three large orders at once. Wonderful news.
To deliver them, however, the owner must buy more stock, pay additional workers and increase transport. Suppliers want their money within 30 days. The customers will pay in 60. The income statement may show healthy sales. The bank account can still be empty.
That is why a business can grow itself into financial trouble. Every order looked attractive individually. Together, they demanded more working capital than the business could comfortably provide.
The growth itself may have been sound. The trouble came from trying to make every opportunity first. Sometimes the financially intelligent decision is surprisingly uncomfortable: turn down profitable business. The customer may be excellent. Accepting the order today could still consume the cash required to pay salaries on Friday. This is where priority and liquidity part company.
A new machine may be the most important investment a company can make this year. Payroll may still have to come first this week. Good financial decisions understand both clocks.
YOUR PRIORITY CAN BECOME MY PROBLEM
Here is where the system gets more interesting. Imagine that large customer decides it cannot pay our SME this month. It will settle next month instead. For the customer, that may be a prioritisation decision. For the SME, it is now a cash-flow problem.
The SME delays paying its supplier. The supplier, suddenly short of cash, postpones buying stock or draws on a credit facility. Perhaps that facility attracts interest. One delayed payment has now travelled through three balance sheets. That is why our financial decisions do not always remain inside our own budgets.
A household cutting discretionary expenditure becomes lower revenue for somebody’s business. A business paying suppliers late can become another firm’s borrowing requirement.
A large institution delaying payment can leave a small supplier profitable on paper and desperate for cash. Scarcity travels. And sometimes the person who eventually borrows is not the person who created the original shortage. That is why cash flow matters so much, particularly for SMEs. Profit tells you whether the business model is creating value. Cash determines whether the business survives long enough to collect it.
PROTECT YOUR ABILITY TO CHOOSE
This brings us to another way of thinking about savings. We usually describe an emergency fund as money for emergencies. True. But it buys something else.
Choice. Imagine your employer pays salaries a week late. Without savings, the problem immediately begins making decisions for you. Which debit order bounces? Who can lend you money? Which bill waits? What will the quick loan cost? With a buffer, the salary delay remains inconvenient, perhaps even infuriating, but it does not immediately dictate your next financial move.
The same is true for a business. Cash reserves can allow an SME to survive a late-paying customer without borrowing at the worst possible moment. They can give management time to renegotiate, find another supplier, adjust prices or wait for an invoice to clear. Cash does not always need to produce the highest possible return. Sometimes money earns its keep simply by preventing desperation, because desperation is expensive.
FOUR QUESTIONS BEFORE MONEY MOVES
So how do we decide when everything feels important? Not with a perfect formula. But with better questions. First: What does this yes make me say no to? Name the trade-off. If E3 000 goes here, where can it no longer go? Until you can answer that, you know the price but not the cost.
Second: What happens if I wait? This separates inconvenience from financial damage. If waiting one month adds expensive interest, risks losing an essential asset or threatens your income, that matters. If waiting simply disappoints you, that matters differently.
Third: How difficult is this decision to reverse? Cancelling a subscription is easy. Signing surety for somebody else’s debt is not. Buying something unnecessary is unfortunate. Committing five years of future income to paying for it is a different decision entirely.
The harder the door is to reopen, the slower you should walk through it. Fourth: How much room will this leave me afterwards? This may be the most important question of all. Affordability is often presented as whether you can make the payment. But being able to squeeze another E1 500 installment into your salary does not necessarily mean you can afford it comfortably. Look at what remains. Can you still absorb a bad month? Can the business survive a customer paying late? Can you deal with the car breaking down after signing the new loan? A decision that works only if nothing goes wrong is already telling you something.
FIRST THINGS FIRST
There is something insincere about financial analysis that treats every request for money as an enemy of the budget because life does not work like that. Family matters. Community matters. Sometimes helping someone you love is exactly what money should do. And sometimes income is simply too small for the obligations it has been asked to carry. No clever spreadsheet fixes that. Prioritisation leaves generosity intact. What it demands is honesty about what each yes will cost.
The financial skill sits between two poor extremes: refusing everything, and borrowing your way to yes. It means consciously deciding for yourself what today’s money must protect, understanding what that choice sacrifices and leaving enough of tomorrow so that when life changes, you still have choices left to make. And that is what financial freedom is – the ability to define and fund what matters, in your own terms.
Mlungisi Ndwandwe is a seasoned strategy and investment executive with extensive experience in corporate development, capital allocation and business growth across international markets. He writes in his capacity as Founder and Chief Executive Officer of Sicebi International Group Holdings.
