How to get on top of personal debt

For many people, getting on top of their finances can feel like a challenge. But it doesn't have to be.

By making informed and responsible choices, you can use a personal loan to consolidate debt or supplement your income to reach your personal financial goals – whether you’re paying for an overseas holiday, managing your debt, starting a family or anything else you have your heart set on.

Stay in control of your debt

In recent years, rising property prices, low interest rates and the availability of consumer credit have seen Australians become more comfortable taking on debt.

While the proportion of households with debt has remained stable in the past 12 years, the average level of debt has almost doubled.

But, some debt can be good according to the ABS, as it helps increase personal wealth and drive the national economy. High levels, however, can also put households at significant financial risk.

If the income of your household is insufficient to cover debt repayments, you may be in danger of defaulting in the event of ‘economic shock’ – such as an increase in interest rates, fall in house prices, job loss or other change in family circumstances.

So if you’re considering taking out a personal loan, make sure you have the income and assets to cover your debts. Try our Budget Planner to assess your current financial situation or talk to a financial adviser.