Financy money tips

Juggling money and credit with a young family

Top tips on how to juggle money and spending while using credit when you have a young family.

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Borrowing credit can be a great way to help you juggle money and manage cash flow when you have a young family but it’s also an easy way to fall into debt if you’re not careful.

Whether it’s steep childcare costs, unexpected medical bills, or the cost of keeping your little ones entertained during the school holidays, it can be easy to clock up debt.

If you’re struggling to manage several high-interest debts, debt consolidation might be the next best step for you and your family.

As there are several ways you can do this, here are three ways you can consolidate your debt to get your finances under control once and for all.

Consider a 0% interest balance transfer credit card

You can use many cards including these cards to transfer one or multiple debts from an existing credit card to a new product with a promotional 0% interest rate on balance transfers.

The exact offer will vary between cards, but these interest-free offers can last anywhere from a few months up to 24 months.

And, if you’re consolidating multiple debts, it means you won’t have to pay multiple account management fees.

At the end of the promotional period, a higher revert rate will apply to any remaining balance on your card, so before you apply, calculate how much you’d need to pay every statement period to repay the entire debt before the introductory offer ends, to ensure the offer is worth it for you.

Consider a low interest personal loan

If you can’t find a credit card to support your debt, you could also consider a debt consolidation personal loan.

While these aren’t interest-free, personal loans usually offer lower interest rates than most other loans and credit cards.

Depending on the loan, you can also choose your loan term, which is usually between one and seven years.

If you have several debts across different accounts you can also use a personal loan to combine multiple debts into one to manage them all under one account.

While most Australian credit cards require applicants to have a good credit history, there are personal loan options for borrowers with bad credit as well.

When comparing personal loans and calculating how much you’ll have to repay in total, make sure you’re also considering the interest you’ll accrue.

You can use the Money Smart personal loan and debt consolidation calculator to compare your consolidation options based on your current financial situation.

Seek financial advice
A debt consolidation credit card or loan can be a smart way to combine and repay your debts at a lower cost.

But if you have a large debt and are going to struggle to repay your new consolidated loan, it might only be a short-term fix.

If you’re unsure which option is right for you or whether you’ll be able to repay your debts, you should get in touch with your credit provider.

Your credit issuer may provide you with an alternative payment plan to help you manage your debt.

Otherwise, a financial advisor or free financial counselling service could offer some independent advice and tips to help get your finances back in order.

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