Debt is a fact of life. Rarely is a home or expensive consumable purchased without finance of some kind.
Australians typically manage their financial obligations well, but higher interest rates, cost of living pressures and unexpected expenses can combine to stress a household budget.
In an increasingly cashless economy, it can be more difficult to keep track of spending, and before you can say, tap-and-go, the morning latte and muffin has maxed out the credit card.
Many can tighten the belt and get back on track. Unfortunately, others find themselves caught in a downward spiral that quickly gains momentum until they realise they’re in over their heads.
Failure to meet your financial obligations may result in you being contacted by a debt collection agency as creditors seek to recoup their losses.
While this is traumatic, keep your cool and remember that you have rights.
According to MoneySmart.gov.au[1] a debt collector can only contact you:
Debt collectors may:
Debt collectors cannot:
If you believe a debt collector or agency they represent has acted outside of their boundaries, you are within your rights to take action.
Violent or threatening behaviour is never acceptable; immediately contact the police.
Alternatively, if the collectors are intimidating or harassing you, write to them or their agency to report the behaviour and request it be stopped.
If this doesn’t work, reach out to the Australian Financial Complaints Authority on 1800 931 678 for advice.
Debt collectors aside, you must take action to manage your debt. No debt ever went away because it was ignored, but there are ways to dial down the pressure.
Here are some steps you can take today to get started:
You can also seek professional assistance from a qualified financial adviser. They’ll work with you to create a budget and/or a realistic strategy for managing your expenses and guide you in developing a plan to move forward and eliminate debt.
Debt can be debilitating and seem overwhelming, but by understanding your rights, knowing where you stand financially and seeking professional advice and support, you can take back control of your finances and look towards a comfortable financial future.
[1] https://moneysmart.gov.au/managing-debt/dealing-with-debt-collectors