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Dealing with money issues can sometimes be stressful. If you are struggling to keep on top of your finances, the sooner you act and seek help, the easier it will be to get back on the road to financial security. Understanding how things like credit or mortgages work can stop you from losing out financially and help you gain control of your finances.

Set your budget

Budgeting is a powerful tool that can help you take charge of your financial future. It helps manage your money so you can cover the essentials and have enough left over to save. It can help you understand where your money goes, what you can afford and makes sure debts are paid.

Budgeting can give you peace of mind that you can handle an unexpected expense. If you can find extra savings in your budget, you could pay more off your mortgage, credit cards or other debts.

Services Australia (formerly known as the Department of Human Services) provides information through its Financial Information Service to help you make informed decisions about your finances.

Budgeting tools and tips

There are lots of free budgeting tools and apps available to help you start and stick to a budget. An example is ASIC’s budget planner.

Explore ways to save more money

Make sure you’re getting the benefits you’re entitled to

Depending on your circumstances, you may be able to get financial support such as Rent Assistance, Family Tax Benefit or Child Support.

Contact Services Australia to find, estimate and compare payments and services.

Sell things you no longer need or could live without

You could consider selling some things that you no longer need or you could swap for a cheaper alternative – such as downsizing a car that is expensive to run.

Be careful when selling assets – make sure they aren't still under finance (e.g. a car loan). You may not be able to sell these types of assets without paying out the loan first.

Reduce expenses

Consider cutting out or cutting down on discretionary expenses such as eating out, gym memberships, new electronics etc. Try things like buying grocery items in bulk when they are on special, or bringing a reusable cup to your regular coffee shop to receive a discount. These small amounts may add up to make a big difference for you over time. 

For more tips see the MoneySmart website Simple Ways to Save Money

Change providers

Changing providers, or even just contacting your existing provider to ask for a better deal, can help make sure you are getting the best value for your money. There are many providers that offer services such as banking, insurance, phone, internet or electricity.

You may be able to make savings by comparing fees and charges and reviewing what’s included in your service. Reviewing your service can make sure you are not paying for services you don't need. This can be especially true if you haven’t looked at your contract for a while. 

Access no or low interest loan schemes

You may be eligible to access a low or no interest loan if you are a low-income earner or Centrelink recipient and struggling to access credit from a bank.

For more information, including eligibility details see the National Debt Helpline No and Low Interest Loan Schemes

Earn additional income

You could consider asking if you are able to do additional paid work with your employer (such as overtime). You might also look at taking on other paid work - for example ride-share driver services, child minding or hospitality, etc. 

Set a savings goal

After doing your budget and seeing how much money you can afford to save, you could set a goal to achieve a specific amount. People who set a savings goal and commit to a plan are more likely to achieve them – and once you get started, and saving becomes a habit, it gets easier. You might put money aside for a specific event or purchase, but it’s also a good idea to have some money set aside for emergencies, in case you are unable to work or have an unexpected expense.

For useful tips on how to set and stick to a savings goal including a savings goal calculator, visit Saving on the MoneySmart website.

Managing a crisis

Unexpected situations such as loss of employment, relationship breakdown or finding yourself unable to work due to an illness or injury can make it difficult to keep on top of your financial commitments.

Building an emergency fund

Having an emergency fund can be a very important step in avoiding significant stress if you experience a loss of income or need to cover urgent and unexpected expenses. If you don't have an emergency fund, and are struggling with making ends meet, talk to your creditors (the people you owe money to). Be honest about your situation and how much you can afford to pay. Often large lenders will have a hardship department that are there to help you. 

Help and support in a crisis

You can also get help from a free financial counsellor by contacting the National Debt Helpline on 1800 007 007. The National Debt Helpline website also has step by step guides and useful information on specific types of debts, such as housing, tax debt or Centrelink debt. 

If you are in a crisis and need access to money fast, there are places you can go to get help. You can search for emergency relief providers in your area by using the Department of Social Services' Grants Service Directory. Choose 'Financial Crisis and Material Aid - Emergency Relief' in the 'Service Type' field.

For more information on support services available, see Where to find help.

Things to watch out for

There are many loan options on the market and not all of them are made equal. Make sure to read and understand what you're signing up for. Things to look out for include:

  • loan minimum repayment
  • loan duration (how long you will have to make those repayments for)
  • amount of interest you will be required to pay over the life of the loan.

If you're unable to make the minimum repayments on a loan, you may have a default listed on your credit report and it could make it harder to get loans in the future. Understanding the facts can help protect you from making a decision that could cause you financial stress in the future.

You may want to speak with a free, independent financial counsellor before committing to something that you may later regret. 

Pay day loans

Pay day loans are short-term loans that are often for small amounts. Be careful though as they often have very high interest rates and penalty fees. These fees can quickly snowball into something much more unmanageable if you can't keep up with the repayments. The MoneySmart website has a Payday loan calculator that can help you work out the true cost of this type of loan. 

Rent-to-buy or product rentals

Rent to buy (such as renting household appliances) could seem very attractive if you can't afford to buy the same products brand new. However, people often end up paying more in the long run and may have to pay penalty fees if the item is damaged or you change your mind. The MoneySmart website has a Rent vs buy calculator to help you work out the true cost of renting and other options available. 

Interest-free deals

Some retail outlets may offer you an interest-free or buy now, pay later financing on purchases, such as household appliances or furniture. Salespeople can also put extra pressure to commit to these deals and encourage you to take on more credit than you intended. Make sure you fully understand how the repayments work and what the interest rate will be once the interest-free period is over. The interest rates and fees will often be very high, and may end up costing far more than paying for the items on a standard credit card. Find out more about interest-free deals on the MoneySmart website. 

Buy now, pay later

Buy now, pay later services offer you the ability to pay for purchases in instalments, while still being able to purchase the product or service. These services are marketed as interest-free, but may have some hidden costs such as account or late penalty fees. It may also be easy to take on more than you can afford and struggle to meet the repayments. Find out more about buy now, pay later services on the MoneySmart website.