Credit card debt in South Africa is so expensive its costs dwarf any benefit of saving for people who are paying off their cards.

If you are one of them and have any doubts about whether to prioritise debt repayment or savings with any additional disposable income, consider some interesting numbers. Don't forget to take your psychological approach to money into account.

Mark MacSymon, an independent financial adviser at Private Client Holdings who holds the certified financial planner accreditation and is the 2017-18 Financial Planner of the Year, says the interest rate on unsecured credit transactions such as personal loans can be as high as 27.75% (repo rate plus 21%), and credit facilities such as credit cards and store cards charge interest as high as 20.75%, making these forms of debt "eye-wateringly expensive".

He adds: "At these levels of interest, any benefit of compounding is completely dwarfed by the sheer cost of short-term debt, making almost every saving and/or investment alternative unfeasible for enhancing personal wealth."

People who live beyond their means by using debt to fund their lifestyle decisions on things they really don't need must consider every available resource to eliminate that debt as soon as possible.

The opportunity cost of interest or growth forgone on your savings is immaterial while encumbered short-term debt is present, he says.

Assume a scenario where you have credit card debt of R80000, you can only afford to pay R2000 a month towards this debt and you do not make any further purchases. It will take you almost six years to pay it off at a typical annual card interest rate of 20.75%.

By the time you have paid off your credit card debt, you would have paid about R57250 in interest - 72% of your original credit card debt.

In other words, it will cost you almost double the shelf price to pay for things with your credit card, MacSymon says.

The new pair of jeans which you bought for R500 will effectively cost you R860 on credit, but if you wait six months these same jeans may well be on sale for 40% less, at R300, he adds.

Should you already have a home loan and credit card debt, adding this credit card debt to an existing home loan can make sense if you are able to manage your debt well. But if you cannot, MacSymon cautions that overspending and financing expensive lifestyle habits using long-term debt is costly.

Although adding the credit card debt into an existing home loan or access bond will provide immediate cash flow relief, for some people there is typically a more fundamental habit to be addressed, which is the discipline of living within your means, he says.

Behaviour plays a role

Carl Wortmann, a certified financial planner and wealth manager at Standard Bank Wealth and Investment, says although the numbers indicate that it is best to pay off debt first, if you follow the typical consumer behaviour you almost never get to saving.

In his role as financial adviser he finds people live on debt more and more due to "lifestyle creep".

For example, they should be saving for their child's education but rather spend on their lifestyle by buying a new home, vehicle or cellphone and as soon as one debt is repaid, they take on another.

He therefore advocates allocating additional discretionary money to both debt reduction and to saving monthly.

The split between repaying debts versus saving each month will depend on your personal circumstances, he says.

For instance, a married man in his early 30s with a young child with typical debts such as a home loan, car loan and credit card account should spend 80% of his disposable income towards paying off these debts and invest the remaining 20%.

On the other hand, somebody who has R80000 credit card debt needs to take a good look at their budget to see how that debt came about.

Wortmann says he would question whether it was the result of a single lavish spend or monthly overspending.

This person needs to take control of spending and commit to paying off the credit card with at least 80% of discretionary money and allocate 20% or less to saving. And once the credit card debt is paid off, they needto focus on investing.

Debt is due to a past financial event, while saving and investing are to make provision for a future event.

Once you have found a reason to save, the focus and commitment closely follow. If you do not have a reason, start with some, he advises.

"It is so easy to spend on lifestyle. One really needs to make a concerted effort to get this type of spending under control," he says.

MacSymon says that given the overwhelming decision set most investors are confronted with - pay off the bond sooner, save tax-efficiently towards retirement or save towards an accessible emergency fund or investment earmarked for the down payment on a property - the optimal solution is as unique as you are.

There is no "one size fits all" in financial planning. The key is to find the right help from an independent, qualified financial planner, he says.

Wortmann agrees your best bet is to find a trusted financial planner, one who understands your current position as well as future goals and dreams, he says.