Utilities bills, mortgage repayments and credit card debt are all contributing to Australian household’s rising financial stress. Last year over 150,000 calls were made to the National Debt Helpline. Calls for the helpline this year are already 20 per cent higher.
Bills are becoming more and more difficult to meet as the cost of living rises. Households are carrying more debt than they have before, reaching a record high of 189 per cent. At the same time, they are experiencing slower wage growth than they have for some decades.
Martin North, principal of financial research firm Digital Finance Analytics has calculated that in March, around 22 percent of mortgaged households were in mild mortgage stress. These are households who are managing to make their mortgage repayments but only by cutting back their spending or putting more purchases on credit cards.
When you do find yourself caught, unable to pay the bills and facing a pile of debt, often the best way out of the credit trap is to look for help from someone who can give you sound budgeting advice. Just learning to draw up a household budget and sticking to it, might even help you avoid getting into that terrible predicament in the first place.
The National Debt Helpline suggest that when times are getting tough, Australians tend to look for a quick fix from credit card companies and payday lenders. Then too often, some weeks later they’ll find themselves in an even worse financial position because they can’t keep up with the high interest rates.
Financial counsellor Greg Russell says many Australians who are close to bankruptcy will simply take on more and more credit card debt, racking up tens of thousands of dollars until it, and the debt collection agency, eventually catches up with them.
If someone owes you money and you’re finding it hard to get them to cough up, you should consider the iCollect debt collection software, a simple and cost-effective means to recovering debts in Australia.