It’s been estimated recently that as many as 2 million Australians are experiencing high financial stress – whereby they may have difficulties paying bills and basic living expenses or making their loan repayments. If you are ever feeling financial stress it’s important to be proactive. The good news is that there are a number of positive steps you can take and plenty of help available to get back on track. Here we walk you through two of the most powerful things you can do.
Do a budget. One of the best tools for this is the budget planner on the moneysmart.gov.au website. The magic of doing a budget is that it will give you a clear picture of your situation. You will know exactly where the money is going and on what. This often is all a person needs to do to see where they can make savings and reduce the pressure. The next step is to decide whether you will realistically be able to pay your debts and meet your expenses without help. For example, you may be able to temporarily reduce some of your discretionary spending, things like entertainment so that you can pay off debts. If you think that no matter what you do you will have trouble paying some of your debts; it’s time to seek urgent help from a financial counsellor.
See a financial counsellor. The easiest ways to find a financial counsellor are to call 1800 007 007 anywhere in Australia or to contact us for a referral. Financial counsellors are employed by not for profit organisations and provide a free service to eligible people. They are expert at helping people who are suffering financial stress, and can not only negotiate manageable repayments with creditors for you, but also provide you with the information and skills you need to become financially secure.
It’s important to find an accredited not for profit financial counsellor and avoid people and organisations that seek to profit from your financial difficulties. These may include businesses which earn fees by providing you with a ‘debt consolidation loan’ or signing you up to a ‘debt agreement’ with your creditors.
Frank Lilley is Operations Manager of ADF Financial Services Consumer Centre