If the burden of debt is starting to take control of you, for some people to consolidate all of these debts into the one loan would be the best solution.  Consolidation allows you to lower your overall interest rate and more easily manage your debt.

Loan consolidation will save you interest where your new repayment and loan term are at least equal to your total current loan repayments and loan terms.  Otherwise, you could be converting your short-term debts into longer-term debt and be paying more interest in the long run.

One option is to use the equity in your residential premises.  If you have owned your home over the last few years, with the fuelling property prices you are likely to have the capital to cover your existing mortgage, as well as other loans and credit cards.  You would need to refinance your home loan which usually offers more competitive interest rates than Credit Cards and Personal Loans.

By paying less interest, more of your repayment can be used to reduce the debt.  This assumes that you maintain the same overall repayments.

You should ensure that your existing home loan offers the features and flexibility to repay sooner rather than later.

To ensure you take control of your debts:

  • Review all your debts regularly,


  1. Close credit card and store accounts and have the discipline not to obtain more. Don’t buy on credit; you are only using money you don’t have.
  2. Credit cards can work well and to your advantage, as long as you use them correctly.  Only use the interest free period.
  3. If you find yourself on the credit card round-a-bout, (that is every time you pay some money off you credit card you go out and put more on it), you have to STOP.  You are spending more than you’re earning.
  4. If you do retain a credit card then ask the institution to reduce the limit to the minimum needed – this should be what you can comfortably repay each month.
  5. Every time your statement arrives pay twice the required amount. Realise that you can do without it. If you don’t stop using credit you will ALWAYS be in debt.
  6. Resolve to spend money where it makes sense and cut back where it doesn’t, paying particular attention to cash and expenditures. Your cheque book and credit card statements reveal big-ticket items, so that monitoring daily spending for a while may show where your money is slipping away in ways that don’t give much satisfaction.
  7. Most importantly a disciplined approach is needed to ensure debts are not increased to fund unnecessary purchases – a good rule of thumb is that your liabilities should not exceed your assets – if they do – it probably means you have borrowed for the wrong reasons.
  8. Remember IT IS NEVER TOO LATE to take back control.
  9. Review your spending patterns and curb these to fit within your budget!
The advice contained herein does not take into account any persons particular objectives, needs or financial situation. Before making a decision regarding the acquisition or disposal of a Financial Product persons should assess whether the advice is appropriate to their objectives, needs or financial situation. Persons may wish to make this assessment themselves or seek the help of an adviser. No responsibility is taken for persons acting on the information provided. Persons doing so, do so at their own risk. Before acquiring a financial product a person should obtain a Product Disclosure Statement (PDS) relating to that product and consider the contents of the PDS before making a decision about whether to acquire the product.
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  • if you get a windfall, use it to pay off any debts. this is a fab article


  • Great! Really good knowledge to know! Thanks for sharing this!


  • All good practical advice which is reasonably easy to implement.


  • Good ways to get your debt under control.


  • If you are in financial strife I say get rid of the credit cards. Cut them up. If you need to be able to pay invoices or bills and cannot pay cash or eftpos etc get a debit card so you only live within your means.


  • interesting read thanks for sharing :)


  • This is a very good guide, thanks!


  • All good advice and ideas here.


  • I review my debt weekly but there is not much I can do about it


  • Thankyou so much for this info. We were just looking into budgeting and this helps a heap


  • I dont have a credit card any more, we miss out on a lot of things, cause well, we just dont have the money available at the time, but I would rather it that way than a debt that just keeps getting bigger and harder to pay off.


  • credit cards are the hardest debt to break – stick to just one and try to keep it low


  • have to follow these tips now


  • All good tips.


  • That’s right with making budget we can control spending.


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