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3 Tips for Managing Your Finances and Getting Out of Debt

3 Tips for Managing Your Finances and Getting Out of Debt
 
Getting out of debt may be one of the most liberating experiences in your life. The journey is difficult, however with the proper finance strategies and discipline, you will find yourself on the right path.

 
1. Figure out your current debt situation.

 
It may be difficult to keep track of all of your debts. To check, we recommend you make a list of:

 
● Any personal debts
● The interest rate on each debt
● The regular repayment amount

 
It may look similar to the following hypothetical example:
 

Product Amount Owing Interest Rate Monthly Repayment Amount
Credit Card $5,000 15.50% $100
Personal Loan $9,000 11.00% $75
Car Loan $12,000 13.00% $250

 
2. Find out how you can cut down on your spendings.

 
Unless you micro-manage your finances, the chances are that you are unsure where most of your money goes each week. It is worthwhile to put aside a few hours and look at your internet banking account to see where your largest expenses are. Overspending tends to occur on groceries, food and drink, gifts, entertainment and telecommunications. The Australian government has a free budget planner which you can access here.

 
3. Contact your creditors.

 
If you are struggling with creditors, it is essential that you contact your creditors to discuss potential payment arrangements. Usually, the sooner that you take initiative, the better. Otherwise, if your account is overdue, your credit score may be affected.

 
If you would like to learn more about the options available to reduce financial distress then please speak to ISA for free and confidential advice on our 24/7 toll-free hotline on 1800 003 883.

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