Written by: Nick Bregozzo

Dealing with debt can be frightening, but it does not need to be. During the global financial crisis, you were encouraged to spend money by purchasing goods to help the Australian economy to continue successfully.

The stimulus package did help Australia to weather the global financial crisis; however, now is the time to take stock of your own personal finances and begin to reduce your debts. Here are three ways that will help you to reduce your debts.

1.… … …  Consolidate your Debts

Do you owe money to a number of different banks or organisations? You can consolidate any unsecured debts by combining as many as possible into the one facility.

There are advantages to having one repayment instead of two, three, or more. If you consolidate your unsecured debts by taking out a single loan instead of a number of loans, you may be able to negotiate lower repayments and a lower interest rate.

Of course it’s easier to deal with one creditor instead of a number of different creditors, especially if you have been experiencing difficulty in paying your loans.

Consolidating your unsecured loans will help you regain control of your personal finances.

2.… … …  Draw up a Budget

Once you have consolidated your debts into one manageable loan, it is time to draw up a budget. If you have never put your budget into writing before, you may be surprised at how easy it is to spend money on items that are not essential.

Your budget should not be so strict that you cannot indulge yourself occasionally, however by writing down a budget you will be able to see how much money you can afford to spend on luxuries and treats.

Your bank may provide you with a brochure that will enable you to fill in your family budget without having to draw up a budget from scratch. Most couples have no problems with listing expenses such as mortgage repayments, internet and phone services, insurances, gas and electricity, and other regular household expenditure. It is important that you are honest with your partner about the amount of money you spend personally. For example, as well as listing money spent on clothing and sporting activities, you should include small indulgences, such as a daily coffee at the local café.

By writing down all of your expenses you will have a clearer picture of how much money you spend and how you spend it. A written budget enables you to find the areas where you may be able to save money.

3.… … …  Save Money on your Regular Expenses

Take a careful look at your regular expenses. How long has it been since you reviewed your insurance policies? Either comparison shop over the internet to get the best possible insurance deals, or ring a number of insurance companies and compare the prices. A long term customer may be able to negotiate a better deal with his existing company. If your insurances are spread over a number of different companies, you may be able to save money by placing all of your policies with the one company. Most insurance companies will reward you with a discount, if you have more than one policy with the company.

Look at your internet and phone bills. Are you getting the best value for your money? You may not be on the best plan to suit your usage and budget. Ring your provider and see if you can negotiate a better deal. You will have more bargaining power if you have your internet, landline, and mobile phones with the same company.

Electricity and gas companies have different deals and different schedules of fees. Look at your last bill and compare the prices with other companies’ prices. One electricity or gas provider may suit the family that uses a large amount of electricity or gas, whereas a different provider may suit a single person or a couple that uses less.

Combine all of your unsecured debts into one manageable debt, draw up a written budget and stick to it, and take a look at your regular expenses to see if it is possible to negotiate a better deal. You will be pleasantly surprised at how easily you can save money. You will soon take control of your personal finances and reduce your debt.


This article shows the Australian reader how to reduce his debt. Learn how to consolidate your debts, draw up a budget, and save money on your regular expenses, such as insurance. The article is suitable for anyone who is worried about his personal finances, or anyone who is interested in saving money