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Get debt under control

Owing money or falling behind on repayments can be stressful. The good news is there are steps you can take to get out of debt.

Understand what you owe

The first step is to get a clear picture of what you owe. Make a list of all your debts, showing:

Include buy now pay later, credit cards, loan repayments, unpaid bills, fines and any other money you owe.

Add the amounts together so you can see your total debt. This step can feel confronting, but it helps you take control.

Reach out for help if you need it

If it feels like you owe a lot, you may be tempted by a quick-fix solution. Like taking out a payday loan or increasing your credit card limit.

Before you jump into anything, talk to a financial counsellor. They can explain your options and help you make a plan to get your finances back on track. This is a free and confidential service.

You can contact:

Both services can help you understand your rights and may help you set up a debt repayment plan. This is a free service.

Work out what you can afford to pay

The next step is to look at your income and expenses to work out how much you can afford to pay towards your debts.

Compare money in and money out

The easiest way to do this is to do a budget.

List all the money:

Add these up, then compare money in and money out.

Use our budget planner to see where your money is going and what you can save

Look for ways to cut costs

Do you have more money going out than coming in? Or are your expenses higher than you'd like them to be? If so, it's time to make some choices.

What are:

Find some expenses that you can cut. Be realistic – don't make it impossible to stick to.

For quick ways to cut back on spending, see simple ways to save money.

Work out your 'debt money'

When you've made your spending cuts, subtract money going out from money coming in.

The amount left over is how much you can pay towards your debt each month. This is your 'debt money'.

Prioritise your debt and bills

Some payments need attention first because missing them can cause bigger problems. 

Higher priorities include:

Use your debt amount to plan how you will pay these first. If you cannot pay a bill on time, contact the provider and ask for an extension or instalment plan. Most major providers offer financial hardship support.

Try setting calendar reminders for when your priority payments are next due.

The National Debt Helpline has a step-by-step guide to help you to prioritise your debts.

Choose a repayment plan that works for you

Once your priority bills are covered, you can focus on paying down your debts. Three ways you could tackle this are:

Small to big (size)

This is where you start small, and pay off your debts one by one.

  1. List your debts from smallest to largest.
  2. Pay the minimum on all debts.
  3. Put any extra money towards the smallest debt.
  4. When that debt is gone, move to the next one.

This method helps you stay motivated as you clear each debt.

Big to small (cost)

This is where you pay off the most expensive debts first.

  1. Pay the minimum on all debts.
  2. Put extra money toward the debt with the highest costs (fees and interest rate).
  3. Repeat until debts are cleared.

This method saves more on interest over time.

Debt consolidation

This is where you roll several debts (like credit cards, personal loans, buy now pay later, store cards) into one new loan. You then make one regular repayment to one lender. 

Learn more about the pros and cons of debt consolidation.

The important thing is to choose the method that you can stick with.

Build a savings habit

When you've got your debt under control, keep the momentum going. Saving regularly will help you avoid money problems in future.

To start:

Then think about how to grow your money to achieve a goal. Such as buying a car, paying for education, or saving for a house deposit.

If you're in crisis and struggling to make ends meet, there are services to help with food, bills, housing, and emotional support. See urgent help with money.