Debts are like weeds. Interest makes them grow at an alarming rate if you ignore them.

The faster you act, the sooner you can stop the problem from becoming even bigger.

Money trouble? Don’t despair. There’s quite a lot you can do and a surprising amount of help is available.

1. Talk to your credit providers. Credit providers have a legal obligation to respond to you if you are having problems paying your loans.

A hardship officer may agree to extend your loan period (so you make smaller repayments over a longer period) and/or postpone your repayments for an agreed period, or offer other ways to make your loan repayments more affordable.

Whether they can help you will depend on the details. To apply for a hardship variation:

  • Contact your lender or credit provider by phone or in writing and ask to speak to a ‘hardship officer’ or to ‘customer service’, and provide the details of your loan – your account name and number, and your payments.
  • Request to change your loan repayments because you are experiencing hardship, as set out in section 72 of the National Consumer Credit Code.
  • Explain why you are having difficulties making payments, how long you think your financial problems will continue and how much you can afford to repay.

2. Talk to your utility providers. Don’t run up more debt paying utility bills with a credit card. As above, let them know you are experiencing financial hardship and request their assistance.

3. If you have fines outstanding, talk to the debt recovery agency in your state/territory and ask for an extension to pay, or a payment plan, or if there is other relief available.

4. Contact the Department of Human Services and explain your situation. Payments and services are available if you are experiencing severe financial hardship, recovering from a disaster, or in need of special assistance.

5. Take control of your budget. Have a look at our budgeting tips, or for more direct assistance, contact the Financial Information Service, a free, confidential service that provides education and information on financial and lifestyle issues via seminars and personal interviews. Call 132 300 and say “Financial Information Service” when prompted.

6. Apply for a No Interest Loan Scheme loan.  Loans of $300 to $1,200 are available to low income people for essentials such as; household items like fridges, washing machines, stoves, dryers; some medical and dental services; and educational essentials such as computers and text books.

You’re in charge. Help us to know which articles are interesting and which aren't. 'Like' the articles you... well... like, and don't 'Like' the others. We'll get the hint!7. Think about using Centrepay, a free service for customers to pay bills as regular deductions from their Centrelink payments, including:

  • rent, including community housing and household goods
  • telecommunications, electricity, gas and water
  • education fees and expenses
  • child care or home care services
  • ambulance costs, medical services and equipment

8. If you do not receive Centrelink benefits, there are private sector companies that offer similar cash flow management services. If you decide to look at these options, shop around and make sure you have a clear understanding of their fees.

9. Seek Emergency relief. If you urgently need help with living expenses there are charities and community organisations that can help you with:

  • One-off food, transport or chemist vouchers
  • Rent or accommodation
  • Part-payment of electricity, gas or water bills
  • Food parcels or clothing
  • Budgeting or referrals to other programs

Contact the Department of Social Services on 1300 653 227 and ask to be put through to your local emergency relief service, or call the Salvation Army on 13 72 58, or St Vincent de Paul on (02) 6282 2722.

10. Find a free financial counsellor near you on the Financial Counselling Australia website, or by calling 1800 007 007.

What are your thoughts?

Are you struggling with money? Is there anything else you’d like to know about budgeting or debt management?

Join the conversation — leave a comment below and let us know what you’re thoughts are.

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