Deal with debt

Steps to help you manage debt and help control your money.

Manage debt

If there’s not enough money in your budget to pay your debts, make a plan to keep things in control.

Step 1 - Identify and sort your debts

Work out what you owe and sort your debts in order of importance by identifying all of the following:

  • who you owe money to
  • how much you owe
  • the interest rates you’re paying.

Step 2 - Work out your expenses

When you know what you spend your money on, you can work out where you can spend less. This will help while you’re paying off your debts.

Step 3 - Think about if it is a need or a want

Once you know your debts and expenses, think about what you need and what are extras you can do without.

Read about how to budget.

Step 4 - Take action and ask for help

Ask for help as soon as you think you’ll have problems meeting repayments. This way you can stop a small debt from getting bigger.

Find free advice

It’s worth getting free advice to help with your finances if you’re having problems.

Our social workers can help you if you’re going through a difficult time. You may want to get counselling, help and emotional support.

It’s always a good idea to talk to someone you’re close to. If you’re worried about any debts you may have, it may help to talk to someone you trust. This could be a friend, family member or someone in your community.

Find a financial counsellor

National Debt Helpline provides a free, confidential and independent service.

You can find a financial counsellor on the National Debt Helpline website.

They can suggest ways to do all of the following:

  • improve your financial situation
  • negotiate repayment options
  • get help from other services for gambling, personal counselling or community legal aid.

They can also provide advice about any of the following:

  • repaying debts
  • debt collectors or debt recovery through the courts
  • house eviction
  • electricity or phone disconnection
  • uninsured car accidents
  • tax debts
  • unpaid fines.

Hardship teams

Many businesses like banks, electricity and other service providers have hardship teams. They may be able to delay, reduce or waive debt repayments depending on your situation.

The Australian Energy Regulator

The Australian Energy Regulator (AER) has made a commitment to protect customers worried about paying their energy bills. It encourages energy providers to continue to work with their customers who are in financial stress. It also helps them manage their debt and stay connected. Read more about the Statement of Expectations of energy businesses on the AER website.

Contact your energy provider to find out what help is available. You can also ask your financial counsellor to talk to hardship teams for you. They often get better results if they negotiate for you.

Rural Financial Counselling Service

Rural Financial Counselling Services support primary producers in the fishing industry and small rural businesses who suffer financial hardship.

Find a Rural Financial Counselling Service on the Department of Agriculture and Water Resources website.

Legal help

You may get a court order, summons, statement of claim or liquidation claim about a debt. Legal notices are serious. Don’t ignore a notice or you may get a bad credit score. Australian Securities and Investments Commission's (ASIC) MoneySmart website details what credit scores are and how they affect you.

Read where you can get free legal advice on the ASIC's MoneySmart website.

Tips and tricks

There's more information and tools on our manage your money page.

If you owe us money, there are options to help you repay a Centrelink debt.

You can also avoid getting a Centrelink debt by keeping us up to date. Tell us when there are changes to your income and any changes in your circumstances.

If you run into problems with debt, the National Debt Helpline has a free, confidential and independent financial counselling service.

If you have overdrawn your bank account, the Code of Operation may protect you. It can stop you from having to pay too much back at one time from your Centrelink payments.

ASIC’s MoneySmart website gives practical advice about managing debt. Read about both of the following:

Related subjects

Page last updated: 20 November 2020