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Managing your debt: Achieve financial freedom without compromising your lifestyle

Updated: Oct 23, 2020


Debt can hold you back when you’re thinking about purchasing a property or starting your savings plans. Owing money or falling behind on repayments can be stressful.


Our wealth management team specialises in building a financial plan for you to get to your financial freedom, fast. With lifestyle priority in mind, we build plans that are achievable and remove financial friction points in your life. Here’s how to get started.


Know what you owe

The first step is to get a clear picture of what you owe.


Make a list of all your debts, showing:

  • How much each debt is

  • The minimum monthly repayment (if any)

  • Include credit cards, loan repayments, unpaid bills, fines and any other money you owe.


Then add up all the debts to see how much you owe in total. It may be confronting, but remind yourself that you're taking charge of your money, and that's a good thing.


2. Work out what you can afford to pay

The next step is to work out how much you can afford to pay towards your debts.


Compare money in and money out

The easiest way to do this is to do a budget.


List all the money you have coming in each month (income), such as salary or benefits. Then list all the money going out (debts and expenses), for things like food, rent or mortgage, credit cards, electricity, phone and transport. Tally these up, then compare money in and money out.


Maximise your entitlements and find savings

If your income has dropped because of the coronavirus, check if you're eligible for extra Government financial assistance.


If you have more money going out than coming in — it's time to make some choices. Think about what are:

  • 'Needs' (can't do without)

  • 'Wants' (could do without, at least for a while)

  • Identify some expenses that you can cut or reduce. Be realistic — don't make it impossible to stick to.


Prioritise your debts

Work out which debts are your priority debts and try to pay them first if you can. Priority debts include:

  • Rent or mortgage payments

  • Council rates and body corporate fees

  • Electricity, gas and water

  • Car repayments — if you need your car for work or essential travel

Build a savings buffer

Use any surplus you have each week to build an emergency fund. This will provide a financial safety net to cover any unexpected expenses or future changes to your income.


Get in touch using the link below and we will help you build a plan that will suit your lifestyle. https://meetings.hubspot.com/blueoceanwealthmanagement


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