Make sure your life can function normally during the transition from extreme debt to living debt-free.
Prepare a budget to work out how much money you need for everyday living. This amount should be set aside from your pay, and not used to sort your debt.
Discuss with your family what you want to achieve in the next five years. Do you want to save for a new household appliance, furniture, or a holiday, or build a nest egg for financial security? It’s important to have something to look forward to.
Three ways to solve the problem
There are three options under the Bankruptcy Act to remove your extreme debt problems: bankruptcy, personal insolvency agreement, and debt agreement.
Talk to an advisor to help you explore, consider and understand all three, but don’t let them tell you what to do. Only you understand how your life works and you need to decide what option is best for you.
Get a second opinion or more, so you can make the decision that works best for you and your family.