Debt management

Debt management helps you take control of your finances, reduce debt, and build a pathway to financial freedom.

What is debt management?

Debt management is about taking charge of your financial obligations; whether it’s credit cards, personal loans, or other unsecured debts. It involves using smart strategies like budgeting, debt consolidation, or setting up a debt management plan (DMP) to keep on top of repayments and work toward reducing outstanding debt.

Whether you’re feeling overwhelmed or just want to get a better handle on your finances, effective debt management helps you stay in control and prevents small debts from turning into big headaches.

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Why is debt management important?

Managing debt is crucial for financial stability. Without a proper plan, credit card debt, payday loans, or personal loans can spiral out of control, leading to financial difficulty. With debt management, you can keep your debt under control, avoid missed payments, and protect your credit score.

Common misconceptions about debt management

  • Debt consolidation fixes everything: it can simplify payments, but it doesn’t erase the debt.
  • Minimum payments are enough: only paying the minimum can prolong your debt and increase interest.
  • Debt management won’t affect your credit score: in fact, it may temporarily lower it, but the long-term benefits are worth it.
  • Bankruptcy is the best solution: bankruptcy is a last resort with long-term consequences.
  • Debt management is for the irresponsible: not at all; unexpected events like medical bills or job loss can happen to anyone.
An infographic, titled 'common misconceptions about debt management'. They misconceptions are debt consolidation fixes everything, minimum payments are enough, debt management won’t affect your credit score, bankruptcy is the best solution, and debt management is for the irresponsible.

Debt management vs. debt settlement: what’s the difference?

Debt management focuses on budgeting, negotiating with creditors, and sticking to a payment plan to manage your outstanding debt responsibly. It minimises interest and late fees while protecting your credit score as much as possible. Debt settlement, however, involves negotiating to pay less than what you owe but can negatively impact your credit score and even come with tax consequences.

Is debt management right for you?

Debt management is for anyone who wants to take control of their credit card debt, personal loans, or other unsecured debts; whether you’re in severe financial difficulty or just want to stay on top of things. Addressing your debt early can prevent it from spiralling into something unmanageable.

How can MyBudget help you manage your debt?

If debt is weighing you down, MyBudget is here to help. Our expert team can create a personalised debt management plan tailored to your financial situation, helping you consolidate payments, negotiate with creditors, and set you on the path to financial freedom. Whether you’re dealing with credit card debt, personal loans, or overdue payments, we’ll work with you every step of the way.

Ready to take the first step?
Enquire online today or give us a call on 1300 300 922 to get started. We’ve got your back!

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This article has been prepared for information purposes only, and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information in this article you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.

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