How to take care of your debt more effectively?

Published on June 15th, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
Our authors

Fact checked

At Savvy, we are committed to providing accurate information. Our content undergoes a rigorous process of fact-checking before it is published. Learn more about our editorial policy.
Take care of your debt

At Savvy, our mission is to empower you to make informed financial choices. While we maintain stringent editorial standards, this article may include mentions of products offered by our partners. Here’s how we generate income.

You have made some money, you spent some money, and you could have even fallen into the red but it doesn’t mean you are stuck there forever. Take control of your finances this year with these handy tips that can help you take care of debt more effectively.

1. Address the root of your problems

Spending. This could be the number one reason as to why many Aussies fall into credit card debt, take out payday loans, and borrow money when they should not be. The way in which you manage the money you get as an income and how you choose to spend it can have an influence on whether you living a debt free life. It starts with budgeting and a great deal of self-discipline to follow through to keep you from going in circles financially. It will boil down to cutting back on things that you don’t need to ensure that you are financially stable.

2. Creating a realistic budget

It is all about creating a realistic budget that is suitable for your finances. According to ASIC, Aussies forked out $ 3,799,910 on household expenses with the average household forking out $74,301. Writing down all your expenses and things you have to pay off can help you see where you are possibly using money that can be placed in other areas. There are a few expenses that you don’t need that can be cut away such as eating out, the gym membership you keep donating to. Avoid going to places or situations that will cause you to step out of your budget.

3. Look for deals that can help you save

According to research by UBank, 86% of Aussies don’t know how much money they are spending each month which can make it hard to see where they could possibly save. Saving doesn’t necessarily mean that you have to be a scrooge. Look for discounts wherever possible to cut back on expenses. If you own a rewards card or a loyalty card, now is the time to make use of the points system. Remember to be careful of overextending your budget in the name of gaining points.

4. Start a rainy day fund

An emergency can pop up when you least expect it such as medical expenses, repairing your vehicle, or a burst geyser can throw your budget off. Taking out a personal loan can help you take care of various emergency expenses and it comes with flexible terms that will not damage your budget. However, not everyone is able to afford to take out a personal loan. Having an emergency fund can create a buffer between yourself and life's mishaps. Once again, it is vital that you create a realistic amount that you will be able to save towards to on a constant basis.

5. You can consider consolidating your debt

Taking care of your existing debt can help you kickstart your journey on becoming debt free. A debt consolidation loan can help you combine all your debt under one interest rate. This will then give you more control over your debt knowing that you will be paying one fee to take care of your debt. Speaking to a financial advisor or a broker is vital when it comes to finding a loan that is suitable for your situation.

Did you find this page helpful?

Thanks for your feedback!

This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

Approval for personal loans is always subject to our lender’s terms, conditions and qualification criteria. Lenders will undertake a credit check in line with responsible lending obligations to help determine whether you’re in a position to take on the loan you’re applying for.

The interest rate, comparison rate, fees and monthly repayments will depend on factors specific to your profile, such as your financial situation, as well as others, such as the loan’s size and your chosen repayment term. Costs such as broker fees, redraw fees or early repayment fees, and cost savings such as fee waivers, aren’t included in the comparison rate but may influence the cost of the loan. Different terms, fees or other loan amounts may result in a different comparison rate.

In this article

Share this article

Share on facebook
Share on twitter
Share on linkedin
Share on email
Share on pinterest

Looking for a personal loan?

Compare personal loan lenders with Savvy and get approved today!

* Terms and conditions and lending criteria apply.

Smart money saving tips

Subscribe to our newsletter.

By subscribing you agree to our privacy policy

Compare personal loans today

We’re here to help you find the most affordable options, so there’s no better way to compare personal loans and rates than right here, all in one place.

Related articles

Take care of your debt

We'd love to chat, how can we help?

By clicking "Submit", you agree to be contacted by a Savvy broker and to receive communications from Savvy which you can unsubscribe from at any time. Read our Privacy Policy.