WisrCredit Bootcamp Week 2
Welcome to part 2 of the WisrCredit Bootcamp. Last week we looked at the importance of your credit report. If there’s anything you missed or wanted to check you can always go back here.
This week we will take a look at debt distress. Especially for those periods when you’re in a cycle of unexpected bills – potentially considering risky monetary behaviours, such as taking out very high-interest loan options (e.g. payday loans). More importantly, we’re going to show you how to get on top of it.
Step 1: Test where you stand on debt
A recent Wisr survey found more than 40% of Australians are in financial stress at some point in time, with many having trouble juggling their spending and debt. Could you be in debt distress? Take our quick quiz to find out.
Step 2: Create a budget
Breaking out of the debt cycle can be challenging. Many people feel like they’re living from bill-to-bill.
In these cases, it’s not uncommon that people are simply spending too much – relying on credit cards or payday loans to help cover any shortfall.
This is extremely risky financial behaviour because of the impact of missing payments or living in debt distress can also have a serious impact on your long-term financial wellbeing.
For example, an overdue payment of a bill of more than $150 can be recorded on your credit file for the next five years. Failing to pay the bill at all for six months could see a serious credit infringement appearing on your credit report for the next seven years.
The best place to start breaking out of the debt cycle is creating a simple personal budget, one which clearly compares your income with your expected expenses for the upcoming month. This will help you work out where your money is going.
Fortunately, the WisrCredit Bootcamp has prepared a personal budget that can be easily updated in minutes. Take some time to complete it now and keep it close to hand over the coming weeks.
Step 3: Stay up to date
That’s it for this week
Keep an eye out on your inbox for week 3 where we tackle the ever important topic of credit cards. If you’ve got some feedback on the program, drop us a line at firstname.lastname@example.org
Disclaimer: This article contains general information only, and is not general advice or personal advice. Wisr Finance Pty Ltd does not recommend any product or service discussed in this article. You must get your own financial, taxation, or legal advice, and understand any risks before considering whether a product or service discussed in this article may be appropriate for you. We have taken reasonable efforts to ensure that the information is accurate at the time of publishing, but the information is subject to change. We may not update the article to reflect any change.