What happens when you ask for free financial counselling?

The Reserve Bank of Australia has increased official interest rates for four consecutive months, lifting the nation’s cash rate to 1.85 per cent. That has added more than $600 to the average $611,158 Aussie mortgage, and official rate futures suggest there are more rises to come.

Financial counsellors report that inquiries for assistance are up, as money pressures bear down. So, if times are getting too tight, how do you ask for free financial counselling? And how can it help?

The clear message from the thousands of amazing financial counsellors around Australia is that anyone can find themselves in financial strife and anyone is eligible to receive financial counselling.Credit:

1. Contact National Debt Helpline

This is a central hub for a network of thousands of free financial counsellors across the country: ndh.org.au or 1800 007 007.

The service is not funded to provide emergency relief – such as food, clothes or shelter – but it can refer you to organisations in your local area that are. Immediate assistance is available from Lifeline: 13 11 14.

The first time you call, you should expect to wait on hold. As in so many industries, there are not enough workers to meet demand.

However, you will ultimately be answered by a caring and compassionate person trained in recognising your particular financial need, who will refer you to the right place.

Calls are confidential (but will be monitored – like everywhere – for training purposes).

As the Helpline’s recorded greeting says: “We collect personal information to provide you with financial counselling and related services.” If you’re worried about what they collect and disclose, there is a privacy policy on its website.

After asking a few “who and where-style” questions, they will say something like: “What has brought you to call today?”

2. Go to an appointment

Your referral will be to a qualified financial counsellor from, usually, a locally based charity. You may need to wait for up to three weeks for an appointment because the services of these professionals are highly desired.

A counsellor will sit down with you and go through every aspect of your money life – your assets and debts, your income and your expenses. All that will feed into a new budget where you may be able to make savings. If you can’t save enough to make ends meet, they will come up with other options for you.

Chief among these could be to apply for financial hardship provisions with your creditors and service providers and, importantly, negotiate with them on your behalf. Financial counsellors also have the inside track with Centrelink and can get over the line any available extra help.

And where you have been hit by a large, unexpected expense for, say, an essential item such as a car repair or replacement, they may tap into a no-interest loan offered by a not-for-profit, such as Good Shepherd microfinance.

With a few bucks in the bank, your level of financial comfort increases as your danger of being forced deeper into debt decreases.

Loans of up to $5000 are available to eligible recipients, with repayments set at a rate you can afford.

A counsellor may well look at a broader restructure, too, such as selling assets to discharge debts you cannot realistically pay back.

3. Future-proof your finances

The goal of a counsellor is two-fold: to not only get you through today but also to get you in a far better, sustainable position for tomorrow. And that’s about putting yourself out of harm’s way of being stretched too thin again, which requires some defensive thinking.

It’s a priority to build an emergency cash fund.

With a few bucks in the bank (preferably three months’ salary, or more) your level of financial comfort increases as your danger of being forced deeper into debt decreases.

Health too often affects wealth, so thinking defensively also entails running some worst-case accident or illness scenarios, such as what would happen if you could no longer earn an income.

The clear message from the thousands of financial counsellors around Australia is that anyone can find themselves in financial strife and anyone is eligible to receive financial counselling… for free.

No longer will you be alone, and you will emerge with a good financial plan to get you back on the right track.

Nicole Pedersen-McKinnon is the author of How to Get Mortgage-Free Like Me, available at www.nicolessmartmoney.com. Follow Nicole on Facebook, Twitter, and Instagram.

Most Viewed in Money

From our partners

Source: Read Full Article