SPEND RESPONSIBLY - Gaining financial control
Are you headed for trouble?
We all like to think we can manage our money, but the number of Australians experiencing debt difficulties shows that this isn’t always the case. If you are consistently spending more than you earn, you could be in trouble, or heading for it.
As a general rule of thumb, if your debt repayments (including those on your credit card) are more than 15% to 20% of your take-home pay, you could be approaching the danger zone.
If you’re unsure, take a look at the list of warning signs below, and if two or more apply to you, it could be time to cut back on your spending and reduce your debt.
- Regularly spending beyond your budget.
- Living from pay packet to pay packet.
- Being unable to meet large one-off expenses like household insurance.
- Paying only the minimum repayments on your credit card each month.
- Not knowing how much your total debt is.
- Being near, or at, your credit card limit – especially if you have more than one card.
- Consistently paying bills late.
- Hiding your indebtedness from your spouse or partner.
- Applying for funds from high-interest, short-term lenders – often called ‘loan offices’ or ‘payday’ lenders.
Getting your money under control is not always easy. And it can take time. If you feel your finances are getting away from you, click on “ My Budget ” and complete the steps to help you regain financial control.