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Top 3 Causes of Personal Bankruptcy in Australia

Nobody likes to consider bankruptcy, which is understandable given that bankruptcy will disturb your financial circumstance for several years to follow. This may be one of the reasons why individuals don’t look for financial assistance in times of need, because they are under the typical misconception that bankruptcy is the only way to work out their financial concerns. Unfortunately, this isn’t the case as there are many choices available to those facing financial difficulties. What many people don’t know is the sooner they act, the more choices will be generally be available to them.

In Australia, personal bankruptcies are on the rise again, with the September 2017 quarter indicating an 8% growth in the amount of bankruptcies cases than the last year. In truth, the September 2017 quarter was the ninth consecutive quarter in which the number of debt agreements increased. Like me, you may be wondering why?

Well, the economy is doing fine with interest rates still at record lows and unemployment steady at 5.6% as of February 2018. Even though the unemployment figures aren’t ideal, it’s floating around average levels which surely wouldn’t cause an 8% increase in the number of personal bankruptcies. So, what exactly has caused 4,236 people to file for bankruptcy in the September 2017 quarter?

If you’re dealing with any financial hardship, understanding the top causes of personal bankruptcy will give you awareness into what aspects of your finances you need to prioritise. Our world is changing quickly and detecting new risks in your own financial circumstance will help you to proactively address them. To give you some insight, here are the top 3 causes of personal bankruptcy in Australia in 2017.

Excessive use of credit

The primary cause of bankruptcy in Australia today arises from excessive use of credit. This is exceptional, since it is the very first time since data collection started in 2007-08 that excessive use of credit has surpassed unemployment as the number one cause of personal bankruptcy.

Naturally, this is an ongoing issue that needs to be addressed. Banks charge extravagant fees and interest charges for late credit card repayments, so if you’re currently behind in your credit card repayments, act now. The Government’s MoneySmart website (https://www.moneysmart.gov.au) has lots of online resources that can help those with credit card troubles. Seeking financial guidance is highly advised to educate individuals how to plan and stick to a budget.

Unemployment

Unemployment or loss of income remains to be one of the most contributing aspects of personal bankruptcy. This comes as no surprise since many Australian’s don’t have income insurance or an emergency fund which they can use if they encounter an unanticipated termination or resignation. With unemployment rates currently at 5.6%, this leaves many Australians without a steady income source and depending only on Centrelink payments to continue to be solvent. The best way to deal with an unanticipated loss of income is to be prepared, which highlights the importance of putting together an emergency fund that can assist you and your family for three to six months.

Relationship breakdowns

The third biggest cause of personal bankruptcies in Australia stems from relationship breakdowns. Divorce rates are gradually increasing, with the ABS recording 46,604 divorces in 2016. Although divorces are not uncommon, financial problems caused by divorces are common given the affiliated legal costs, child support, and the abrupt transition into a one-income household. Many individuals end up inheriting debts from their partners or are not able to pay off existing credit because their expenditures have greatly increased.

Looking ahead

Irrespective of the reasons for your financial challenges, the fact remains that the sooner you seek financial assistance, the more prospects will generally be available to you to resolve these issues. Lots of individuals grapple with debt for years before seeking help. If you’re juggling your finances and avoiding phone calls, don’t wait any longer. Call the specialists at Bankruptcy Experts Tamworth on 1300 795 575, or alternatively visit our website for more information: www.bankruptcyexpertstamworth.com.au

 

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Weddings On A Budget – How To Save Money When Getting Hitched

We all have a fairly good understanding that weddings can be an expensive pursuit, but do you actually know just how much the average wedding costs in Australia? A little over $36,000, based on Australia’s Money Smart website. And that was in 2012! At present, it’s quite likely somewhere around the $50,000 mark. I suppose if you have rich parents it wouldn’t be a concern, but unfortunately most of us don’t.

Let’s admit it, $50,000 is a considerable amount of money! You could buy a company, place a down payment on a new house, settle your student loans, or maybe travel the world! The fact is though, weddings are a celebration of two people who commit to devoting the rest of their lives with each other. Sure, we ‘d all love to have the wedding of our dreams, but we shouldn’t forget what’s really important.

Even though I’ve never been married personally, I have a close circle of friends, and two of them managed to pull off the most splendid weddings on a shoestring. Obviously, it didn’t consist of costly bridesmaid parties and catering for 400 guests, but it was intimate, unique, and everybody who came had the time of their lives. If you’re organising a wedding on a budget and looking for ways to save money, then here’s how.

Location
There’s lots of ways to save thousands of dollars on your wedding venue alone. One of the most beautiful weddings I was invited to was in the backyard of a friend’s home. Other alternatives you could look into is hiring a local park for the day, or maybe the beach. The atmosphere is fantastic, you can customise your wedding to exactly how you want it, and the costs are exceptionally low. If you choose to have your wedding in a public place, just remember to talk with the local council and make reservations well ahead of time.

Wedding Date
Although many people prefer their weddings on a Saturday, the rates of venues are far more pricey on Saturday than any other day of the week. Think about having your wedding on a Friday or Sunday where Monday is a public holiday. The time of year will also have a significant impact on the fees of your venue. If you’re dead-set on having your wedding reception in an indoor area, then organise your wedding date in winter and you’ll save around a third of the costs for venue hire.

Photography
The cost of a professional photographer will often cost around $4,000 for the whole day. With the outstanding specs of smartphone cameras nowadays, think about hiring a professional photographer only for the formalities and ask your buddies to take photos throughout the duration of your wedding. You can make a hashtag on Twitter and ask your friends to post their photos, ensuring that there’ll be an abundance of natural photos that reflect the true spirit of your special day.

Food & Drinks
If you really wish to save money, then catering businesses are your key target! They charge extravagant prices and aren’t all that necessary. Consider putting together your own food and drinks and don’t hesitate to go against the grain here.

You could hire a wood fire pizza truck that serves gourmet pizza, or look at hiring somebody to roast a whole pig in the ground and make the sides yourself. For me, there’s nothing better than a pulled pork burger with delicious sauce and cheesy smashed potatoes! Remember that most of the time, being original is much more memorable than being traditional. Also, search for a venue that allows you to bring your own alcohol. You’ll save a pile of money this way, and you’ll be able to negotiate a sizeable discount when buying in bulk.

Don’t Borrow Money
It’s not out of the ordinary for newlyweds to borrow money to cover their weddings, not knowing how hard it can be to pay back. Not only will you be paying for the wedding itself, but also interest on top of that, which can frequently take years to pay off. If you’ve had a luxurious wedding and found yourself in financial difficulties, always seek financial help sooner rather than later. The sooner you act, the more choices will be available. For any financial assistance regarding your personal circumstances, get in contact with Bankruptcy Experts Tamworth on 1300 795 575, or visit our website for additional info: www.bankruptcyexpertstamworth.com.au

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Personal Finance Tips – Finance Goals In Your 30’s.

There’s no doubt that hitting your 30’s is a significant milestone for us all. While some of us may have embarked on a new career, bought a house, or even started a family, this decade of our life has a considerable financial impact for your future years. For most people, our financial commitments have probably grown and juggling expenses and responsibilities with saving money for the future is harder than ever.

Many of us have dusted off the mistakes of our 20’s and discovered a thing or two, however this decade of our lives is the time when we really have to mature and seriously consider our financial situation. We need to prioritise commitments, like our children’s education and retirement savings, and take the most suitable steps to achieve a prosperous financial future for you and your loved ones. Life can unquestionably get more complex in your 30’s, however by focusing on a couple of crucial aspects of your finances, your money doesn’t have to be nearly as complicated.

By making modest lifestyle adjustments, you can significantly bolster your financial circumstance now and in the decades to come, so here are some personal financial goals that everybody in their 30’s should look at.

Increase your emergency fund
Hopefully you initiated an emergency fund in 20’s, saving enough funds for several months’ worth of costs. This is a fantastic goal to reach in your 20’s, but making more money and having increased financial obligations in your 30’s signifies that your emergency fund becomes increasingly important. Finance specialists highly recommend that folks in their 30’s should have at least 6 to 12 months of living expenditures saved in their emergency fund. Keep in mind, moving back in with your parents is much more difficult in your 30’s, particularly if you’re a parent yourself.

Review your insurance coverage
Normally, people’s circumstances change significantly in their 30’s. You may have bought a new home, a new car, or have started a family, so it’s crucial that you review your insurance plans so they’re up-to-date. It’s likewise a practical idea to have a look at income protection and life insurance along with your existing insurance coverage. Even if your personal situation hasn’t changed in your 30’s, you should nonetheless review your insurance plans several times a year to make sure that you’re getting the best rates and premiums.

Strengthen your retirement savings.
Now is the time where you should begin building your retirement contributions, specifically if your workplace offers a salary sacrifice plan. Making voluntary super contributions is a great way to grow your nest egg, so if you receive a pay increase, look into using the supplementary income towards your retirement savings. In addition to this, if you start a new job or career, always make sure that use the same super account which will significantly minimise costs and maximise your retirement growth.

Live well below your means.
When you find yourself having more financial responsibilities, you should revise your budget and make sure you’re living well below your means. The secret to improving your wealth is to increase the gap between what you earn and what you spend. You’ll quite likely need to cut down some expenses like eating in restaurants or cable television subscriptions, but the more money you save, the quicker you’ll accomplish your financial objectives. It’s also advisable to look at percentage of income saved instead of dollar amounts, as this makes it a lot easier to ascertain which expenses can be minimised to ensure you’re always saving more than you earn.

Seek financial help sooner rather than later.
If you’re finding it a challenge to make mortgage repayments on time or you’re plunging deeper into debt, seek financial assistance as soon as possible. Often, the sooner you do something about it, the more choices will be available to you. Many people suffer financially for several years prior to seeking help, and not only are they in a far worse position, but it is also completely unnecessary! There are many possibilities available for those in financial trouble, so if you need any financial help, phone Bankruptcy Experts Tamworth on 1300 795 575, or visit our website for further information: www.bankruptcyexpertstamworth.com.au

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How To Save Money On Food

All of us experience phases in life where money is tight. Luckily for us, there are several expenses that we can simply eliminate, like cable television, gym memberships, and eating out at restaurants. Despite this, there are other expenses that we simply can’t avoid. Rent, debt repayments and school tuition are just a couple of the mandatory expenses that are fixed and there’s not much we can do about it. Having said this, there is one mandatory expense where we can all save a great deal of money; and that expense is food.

Having performed some research, I’ve found there are a number of ways in which we can all save on food expenses. Needlessly to say, eating out at restaurants is far more expensive than eating at home, but I’m talking about saving money on your weekly food bills. You’ll be surprised at just how much money you can save by following some basic guidelines, so here are some quick tips that can save you thousands of dollars each year on your food bills.

Plan your meals and prepare a shopping list
Have you ever had to throw out food simply because it’s past its expiration date? I know I have! By planning each meal of the week, you can be sure that you only spend money on food that is really needed. Look in your kitchen to find what ingredients you presently have, which ingredients you need to buy, and prepare a list of all the ingredients you’ll need for the following week.

The majority of us are regretful of impulse buying at the grocery store, so planning your meals and sticking to the ingredients on your list will drastically lessen any impulse buying. Don’t forget to always keep a pen and paper in the kitchen, so when you run out of a certain ingredient, you can write it down quickly and potentially eliminate a 2nd trip to the grocery store. And always shop for groceries on a full stomach!

Don’t bring your kids to the grocery store
Occasionally it can be tricky to organise, but if you go grocery shopping when your children are at school or in the evening when somebody can keep an eye on them, you’ll save a great deal of money. Not only can you shop faster, but you don’t have to drain your energy by saying ‘NO’ to your children every aisle. Usually this can be frustrating, so lots of people will give in here and there, and these unnecessary products will accumulate over the year far more than you’d imagine.

Shop at night
Speaking of shopping at night, you’re more than likely to uncover the best prices at this time of day. Big grocery stores will often discount items when they’re overstocked, and perishable goods like bread, fruit and vegetables will also likely to be marked down. While it may seem a bit cruel after a long day, you can bag a lot of bargains by shopping at night.

Buy in bulk
It should come as no surprise that buying in bulk will save you money, particularly on discounted items. Be cautious though, you don’t want to buy too much and throw away food, but always bear in mind that you can cook meals and freeze them for a later time. Butter, bread, and cheese will last up to three months in the freezer, and meat products will typically last up to six months. Just make sure you have enough room in your freezer first!

Try discounted grocery stores
Discounted supermarkets like Aldi will always have goods that are more affordable than the supermarket giants like Woolworths and Coles. Nevertheless, some goods will be more costly, so try finding bargains at discounted supermarkets before heading to your normal supermarket. While you may not recognise some of the brands, the quality of the food is practically the same. The design is also different, so it may take a bit of getting used to, but if you want to save money on food then this is an exceptional idea.

If you’re going through financial challenges, always bear in mind that there are basic ways to save a great deal of money on one of your largest expenditures. By making some modest adjustments together with a dash of self-discipline, you can potentially save thousands of dollars every year on your grocery bills.

If you find that your financial situation is still worsening, it’s always better to seek financial advice sooner rather than later. Speak with the professionals at Bankruptcy Experts Tamworth on 1300 795 575, or visit our website for more financial advice: www.bankruptcyexpertstamworth.com.au

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Best Ways To Save Money And Improve Your Life

These days, saving money is a plan that everybody wants to accomplish, though usually it can be a difficult task for lots of folks. Rent, bills, food, and everyday necessities accumulate quickly, leaving most households with little to no savings. Being able to save money and enhance your life seems to be a paradox, as we mostly associate a better life with spending more money! Irrespective of this, small lifestyle alterations can have an inspiring effect on your savings balance as time passes, and investing these savings sensibly will certainly improve your life in the long-term. All it takes is some discipline, motivation, and knowledge.

With the new year upon us, now is a suitable time to review your financial situation and plan to track your spending patterns and cut needless expenses. After all, saving money means earning greater than you spend, so here are the leading ways you can save money in the new year to secure a better future for you and your family.

Inspect your financial circumstances
If you don’t understand your financial situation, then there’s almost no way that you can strengthen it! Being able to make sound financial decisions begins with education and understanding where your money is being spent. Most of the time, it’s tough to keep track of our expenses, so it’s a smart idea to start keeping your receipts and overviewing your expenses every week to acquire a better understanding of your spending habits. This is the most vital step in being able to save money. Now, let’s explore some specific money saving strategies.

Groceries
Saving money on food is much easier than you think. The trick is to arrange your meals a week in advance before you head to the grocery store. Once you’ve planned your meals and the appropriate ingredients, produce a list and stick to it! Don’t go grocery shopping hungry either, that’s a sure way to spend unwarranted money impulsively. It’s also a great idea to have a paper and pen in the kitchen area, so when you run out of a particular ingredient, you won’t have to make a second trip to the supermarket in case you forget.

Electricity
Electricity is another manageable way in which you can reduce expenses by making some small adjustments. The most beneficial way to save electricity is by turning off devices at the power point when you’re not using them. Even though the appliances aren’t being utilised, an active electricity socket continues to use electricity, and these expenses can really add up as time passes. Other ways to save on electricity is to use fans as an alternative to air conditioners, turning off lights that aren’t being used, using hot water bottles as opposed to electric blankets, and using a clothes line as opposed to a dryer.

Entertainment
All of us need to let off some steam after a hard day’s work, so a glass of wine and some cable television works for most people. Having said that, cable television is an enormous expense that is rarely used to its full capacity. Consider switching to streaming services like Netflix or Hulu which charge somewhere around $10 a month as opposed to the standard $70 a month for cable TV. That’s a saving of over $700 a year alone. In addition, instead of eating in restaurants with friends once a month, opt for hosting a dinner night where everyone brings a dish and their beverage of choice. You can rotate hosts, save stacks of money, and never have to worry about being too loud!

Invest your savings
While these recommendations are far from comprehensive, saving money by making trivial changes gives you more financial options to enhance your life. You could use these savings to indulge in a family holiday once a year, or you might choose to invest your savings in a diversified investment portfolio. Whichever you chose, the fact of the matter is that we can all make small sacrifices to save money which can be used to enhance our lives.

Having problem with Debt?
If you’ve found yourself in a position where you’re continuously dealing with debt and can’t see any way out, there are a couple of options available for you. You don’t have to live your life in worry and stress, and the sooner you act to rectify your predicament, the more choices will be available for you. If you need professional advice on any financial problems that you’re currently facing, don’t wait any longer. Speak to the specialists at Bankruptcy Experts Tamworth on 1300 795 575, or visit our website for further information: www.bankruptcyexpertstamworth.com.au

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New Year’s Resolution – Improving your Financial Health

The New Year is obviously a fantastic time to reflect on the previous year and make some resolutions to improve ourselves. Most individuals’s resolutions centre around getting healthier, strengthening their career, or improving their financial position. Now all of us understand how challenging it can be to stick to our New Year’s resolutions, so it is essential that you make realistic, attainable goals that can be accomplished with a certain degree of persistence and self-control.

If you’ve elected that you want to improve your financial health in 2018, there’s a decent amount of preparation and planning needed. To realise significant financial improvements in your life, it’s critical that you concentrate on the things you can control and to evaluate your progress routinely. To give you some insight on how to do this, the following details some suggestions that you should follow if you choose to enhance your financial well-being in the following year.

Set clear financial goals
Research reveal that simply writing down goals noticeably increases the likelihood of you accomplishing them. In a monetary sense, writing down exact goals with an expected timeline not only increases the likelihood of you accomplishing these goals, but you’ll likewise understand what is most important to you.

Some financial goals, for instance retirement, may require the support of a financial planner, but there are many simple, obtainable goals that you can plan on your own, for instance buying a vehicle, saving for a home deposit, or organising an emergency fund for a rainy day. It is crucial that you take small steps to achieve these goals, and assessing your progression often is the key to success.

Increase your savings
The majority of people have no idea how much money they save annually, so it is crucial that you assign an actual dollar amount that you hope to save for the coming year. Regardless if you achieve this goal or not isn’t the issue, the fact that you’re specifying specific goals and planning ways to accomplish these goals is the most important aspect.

Simple ways to increase your savings account is to increase your superannuation contributions (and possibly Government payments), or schedule an automatic deposit into an emergency fund or high interest savings account each week. Regardless of how you do this, increasing your savings will enhance your net worth and overall financial health.

Track your spending
Understanding just how much you spend each month is pivotal in having the ability to increase your financial health. Keeping every bill and receipt and manually producing a spreadsheet is one way to do it, but there are a number of fantastic apps that track your spending on the go, providing you with a true indication of how much you’re spending with minimal effort required.

ASIC’s TrackMySPEND app (https://www.moneysmart.gov.au) is a credible and effective tool that helps you understand your average monthly and annual spending, so you can better plan and accomplish your financial goals. If this doesn’t satisfy you, there are lots of other apps available, so don’t be afraid to test a few to find which is best for you.

Examine your mortgage and insurance policies
Assessing your mortgage and insurance policies is a reliable way to increase your savings. For example, you should be examining how your current mortgage and insurance policies measure up to other providers on an annual basis. Banks and lenders change their policy structures all the time, so chances are you can get a better deal if you do a bit of research.

Even small decreases in interest rates can save you thousands of dollars every year, so it’s absolutely worth the time and effort! If you find a better offer elsewhere, don’t hesitate to ask your current provider to match it, and similarly, don’t be afraid to switch providers if they don’t. There’s an abundance of online resources which can successfully guide you through this process.

Seek advice quickly if you’re experiencing financial hardshp
Improving your financial health doesn’t always correspond to increasing your savings and emergency funds. Lots of folks suffer through years of stress from financial distress without realising that there are plenty of options available to them to enhance their financial wellbeing.

If you’re encountering any financial suffering, the sooner you seek professional advice, the better your recovery options will be. For any advice relating to your financial circumstances, don’t hesitate to talk to Bankruptcy Experts Tamworth on 1300 795 575, or visit our website for additional information: www.bankruptcyexpertstamworth.com.au

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The best ways to Repair Your Credit Rating After Bankruptcy?

Congratulations! You’ve successfully served your 3 year period of bankruptcy and have been discharged, so now what? You’ve undoubtedly taken the most suitable measures to settle your financial challenges by declaring bankruptcy, and all your debts are well behind you now. Keep in mind though, there’s still plenty of work involved to get your finances back in order. The greatest issue that discharged bankrupts face is their ability to borrow money, and the reason for this is their bad credit rating.

For the last 3 years, you’ve had no debts to pay off so your credit history has nothing to show other than a bankruptcy mark next to your name. There’s been no movement on your credit report, so a blank page will make lending institutions hesitant in lending money to you simply because they can’t inspect your repayment behaviours. Repairing your credit rating is the best way to get your finances back on course, and make your recovery process as smooth as possible.

Ways to repair your credit report after discharge?
Since lenders haven’t had the ability to ascertain your financial management skills for the past three years, you need to begin exhibiting healthy financial habits. Here’s a list of ways in which you can do this

1. Steady employment
Obtaining reliable and ongoing employment is an effective way to enhance your financial security and display to financial institutions that you have a regular source of income. Stable employment will enable you to increase your savings and strengthen your overall financial condition, resulting in a better credit rating.

2. Increase your savings balance
Your savings account is an asset, so increasing your savings balance gradually will demonstrate to loan providers that you are financially sensible and are capable of making loan repayments. By putting money into a specialised savings account every month, even a small amount, will improve your credit history.

3. Limit your credit applications
Whenever you apply for a line of credit, it is documented on your credit history, so excessive credit applications can adversely impact your credit rating. After being discharged, it’s integral that you are sensible and vigilant about the kinds of credit you apply for to increase your chances of approval. It’s best to make an application for only one line of credit at a time, and bear in mind that secured loans and options with a guarantor or joint accounts will increase the likelihood of approval.

4. Consider a term deposit
If you’ve been able to save money throughout your bankruptcy period, think about investing some of it into a term deposit account. Not only will you accumulate interest and improve your overall financial situation, it will additionally show financial institutions that you are financially sensible. Subsequently, the likelihood of acquiring a loan will be increased which leads to an improved credit rating.

5. Always make repayments on time
One of the most important things you can do as a discharged bankrupt is to make any kind of repayment on time. Regardless if it’s your rent, electricity, or even a secured loan in your name, making these repayments on time will most certainly improve your credit history and increase the confidence that lenders have in your financial management skills.

6. Don’t hesitate to talk with lenders
If you wish to request a line of credit after your bankruptcy period, or discover what types of options are available to you, don’t hesitate to speak with banks or other financial institutions to review your situation. They are in the best position to advise of your eligibility, and offer insight on what options would work best for your personal circumstances.

Be cautious of credit repair agencies
There are plenty of credit repair agencies that will make all kinds of promises to improve your credit record. While many of them are effective in disbuting any incorrect listings on your credit record, they may not be able to do anything else to improve your credit report. The Government’s MoneySmart website (https://www.moneysmart.gov.au/) advises discharged bankrupts to be “very careful” of these agencies since they “may not always be able to do what they claim they can”.

If you need any guidance in repairing your credit history, or have any concerns with respect to your recovery process after bankruptcy, it’s always best to seek advice from qualified professionals. Get in touch with Bankruptcy Experts Tamworth on 1300 795 575, or alternatively you can visit our website for additional information: www.bankruptcyexpertstamworth.com.au

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4 Money Saving Ideas This Christmas

Christmas can be a wonderful time of year. Spending quality time with your family, being on holidays, offering presents to loved ones, and certainly the grand Christmas lunch! It’s most certainly a time for giving, and with this comes expenses. It’s very easy to go overboard with family holidays, presents, and scrumptious foods; to let your hair down and savour the spirit of Christmas. The bottom line is, though, that the silly season inevitably passes and many of us are left with the strain of large credit card balances. Some individuals spend months attempting to repay their Christmas debts, while others end up in much deeper water.

Although some folks have the financial capacity to shower their loved ones with expensive gifts and lavish functions, many of us should be watchful to spend within our means so our Christmas joy can smoothly sail into the New Year. So with this being said, I want to share with you some reliable ways of celebrating Christmas, without breaking the bank.

1. Set a Budget

While it may sound clich√©, it’s very important that you create a budget and adhere to it. Produce a list of all the presents you’ll be giving and calculate the total amount. The majority of the time, it will be far more than you imagined. Use this as encouragement to think outside the box (pardon the pun!) and make some modifications so you can stick to your budget. You could have a garage sale and sell things that aren’t being used anymore, speak with family and friends about a setting price limit for gifts, or perhaps contemplate making gifts yourself! ASIC has released a fabulous app to monitor your Christmas spending called TrackMySPEND (https://www.moneysmart.gov.au/) which I’m certain many of you would find invaluable.

2. Shop Online

Even though many people find pleasure in wandering through department stores and basking in the magnificent Christmas displays, almost all the same goods are offered online at more affordable prices. Utilise comparative shopping websites like Google Shopping, Nextag, or PriceGrabber to locate what you’re searching for. These websites are incredibly competitive and will usually have discounts that can save you a bunch. Whilst shopping online will be more cost-effective, you have to take extra precaution to ensure you get what you paid for.

3. Rethink your Christmas Cards

If you’re one of the many families who send Christmas cards to all your family and friends, you’ll comprehend that the costs of this exercise can be considerably expensive. It’s no surprise that only a few of your friends and family will actually keep these cards so it’s essentially just money down the drain. As an alternative, why not send a family Christmas video message online? There are heaps of apps on smart phones and tablets that allow you to send fun and amusing Christmas videos that can be sent out electronically at no cost at all. Additionally, you can always create your own Christmas cards with personalised messages and have your kids draw pictures to make them super special!

4. Wrapping Paper

A beautifully wrapped gift can make a powerful difference, despite being the cheapest of presents. Christmas paper can be quite costly, so contemplate buying plain brown paper and adding a festive ribbon from a craft shop which will look a lot nicer than Christmas paper. You can even re-use brown paper bags that are often given at clothing stores. Additionally, consider buying plain green, red, or gold paper which can also be used as birthday presents throughout the year. Don’t forget, certain department stores will wrap your presents for free, so don’t hesitate to ask!

As you can see, Christmas festivities doesn’t need to break the bank. Sadly, however, lots of folks spend beyond their means and end up in financial hardship in the New Year. If you find yourself in this position, it’s better to seek professional advice sooner rather than later. There are many solutions available to you; all you need is the right advice. For any support on financial hardship, speak with the specialists at Bankruptcy Experts Tamworth by calling 1300 795 575, or alternatively visit our website for further information: www.bankruptcyexpertstamworth.com.au

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Everything you will need to know about Bankruptcy Notices

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If you have been given a bankruptcy notice or court order you must act immediately to prevent future distress. Owing someone else money referred to here as a creditor, can be any person or business to whom you owe money. If you’re unfit to pay money to a creditor, the creditor will consult the Australian Financial Security Authority (AFSA) who will in turn deliver a bankruptcy notice requesting payment of that money.

Of course, there is a threshold to the quantity of money owing to creditors before they can speak with the AFSA, and the minimum amount is $5,000. Soon after the creditor has gotten hold of a final judgment, AFSA will issue you with a bankruptcy notice.

It’s extremely important that you take timely action if you receive a bankruptcy notice from the AFSA. You will commit an ‘act of bankruptcy’ if you do not do any of the following:

  • Abide by the bankruptcy notice inside the requested timeframe mentioned on the notice (normally 21 days); or
  • Apply to the courts to ask for the bankruptcy notice be cancelled or set aside inside the timeframe reported on the notice (normally 21 days).

Committing an act of bankruptcy indicates that you give your creditor permission to apply to the Federal Circuit Court for a sequestration order, or simply put, an order that will make you legally bankrupt.

How does a Bankruptcy Notice get served to me?

A bankruptcy notice could be served to you in a couple of ways; it may be validly served to you in person, by ordinary post, or hand delivered to your registered address. In several circumstances, a bankruptcy notice may be served in an electronic form, either through email or fax.

If it’s not attainable for a creditor to serve a bankruptcy notice using any of these means, a court order may be acquired which makes it possible for creditors to serve the bankruptcy notice in a different way.

I have a bankruptcy notice, now what?

To abide by a bankruptcy notice, you must do one of three things:

  1. You must pay in full the amount stipulated in the bankruptcy notice; or
  2. Set up an agreement with the creditor, such as a payment plan over a defined time period. The creditor must accept the payment arrangements terms and conditions. It’s always advised that the agreement is made in writing so you have documentation of the agreement.
  3. Get some insolvency advice. At this point, you must not delay and get some assistance. If you have a notice of bankruptcy, just give us a call here at Bankruptcy Experts Tamworth on 1300 795 575 for a Free Consultation.

It is necessary to note that all of these actions must be taken within the timeframe stipulated in the bankruptcy notice (usually 21 days from the date of the notice).

Can I get my Bankruptcy Set Aside?

If warranted, you can apply to the court to have the bankruptcy notice cancelled or set aside. This should not be taken lightly though, given that if there are inadequate grounds to make an application then you will be liable to pay all the creditors legal costs which only increases the debt you owe to them.

If you do apply for your bankruptcy notice to be set aside, it’s always a good idea to request that the court extends the timeframe for compliance with the bankruptcy notice, so you keep away from committing an act of bankruptcy while the court processes your application. In short, don’t leave it to the eleventh hour.

To have your bankruptcy notice set aside, one of the following conditions must apply:

  1. The debt claimed on the bankruptcy notice does not exist;
  2. There is a defect in the bankruptcy notice;
  3. You have grounds for a counter-claim, cross demand, or set-off, equal to or exceeding the sum of debt issued in the bankruptcy notice; or
  4. The bankruptcy notice is an abuse of process.

What if the debt claimed on the bankruptcy notice does not exist?

To establish that the debt claimed on your bankruptcy notice does not exist, you will need to provide evidence that:

  • You have in fact paid the creditor the amount owing under the order or judgement; or
  • You have appealed the order by commencing proceedings to set aside the order or judgement.

In your application to set aside the bankruptcy notice, you can not simply say that you have a persuasive argument to do so. You must have already submitted the applicable documents with the court that handed down the order. Further, you must have the ability to provide evidence to the Federal Circuit Court that reveals that you have a genuine case for grounds of appeal.

On top of that, if you do not initiate the process of setting aside the judgement or order prior to filing your application to set aside the bankruptcy notice, the Federal Circuit Court will not have the ability to extend the timeframe for compliance under sections 41( 6A) and 41( 6C) of the Act. For that reason, you will have committed an act of bankruptcy.

What is a Defective Bankruptcy Notice?

A defect in the form or content of the bankruptcy notice happens when the creditor has failed to obey the requirements of the Act, in which case you might have grounds to apply for the bankruptcy notice to be set aside. Some defects are more severe than others, and not all defects will make a bankruptcy notice void as these defects can be mended at the discretion of the court under s 306( 1) of the Act.

In general, the defect must be serious or inflict confusion over the actions you must take to abide by the bankruptcy notice for you to have the capacity to set aside the bankruptcy notice.

There are some fundamental requirements of a bankruptcy notice and if these requirements aren’t met, the bankruptcy notice will consequently be invalid. The following details some examples where these essential requirements have not been met:

  • The creditor’s address on the bankruptcy notice must make it reasonably practicable for the debtor to make payment (e.g. PO Boxes may not be suitable);
  • The creditor’s and debtor’s name on the bankruptcy notice must match the creditor’s and debtor’s name in the order or judgement;
  • Attached to the bankruptcy notice must be a copy of the judgement or order;
  • It is a requirement that there is a timeframe for compliance included in the bankruptcy notice;
  • If the creditor is claiming interest on the debt owed to them, the calculations must be detailed in a separate document attached to the notice; and.
  • If any part-payments made by the debtor, or any other allowed reductions, the total amount of these deductions must be specified in a separate document attached to the notice.

 

The following specifies some scenarios where bankruptcy notice defects have not been serious enough to make them invalid:

  • Failure to include the ACN of the company who is the creditor; and.
  • The creditor’s address is listed as the address of their solicitors (assuming payment can be reasonably made to this address).

There are several other legal requirements that should be born in mind. These include:

  • The order or judgement must be at least $5,000, not including any post judgement interest being claimed by the creditor;
  • A bankruptcy notice can still be issued if the total amount is lower than $5,000, provided that the total amount was greater than $5,000 when the order or judgements were pronounced;
  • A bankruptcy notice must be based on a final judgement or order that is currently owing to a creditor under s 40( 3) of the Act. A final judgement is defined as a judgement which finally disposes of the rights of the parties involved;
  • A bankruptcy notice must be served with six months of its issue. The only exception is if the Official Receiver (reg 4.02 A) has increased this timeframe;
  • The final order or judgement must not be stayed both at the time of issue of the notice and the time of its service. If a stay of execution is granted after service, it has no bearing on the bankruptcy notice;
  • An overstatement of the amount claimed to be owed to a creditor does not annul a bankruptcy notice, except if the debtor contests the credibility of the notice inside the timeframe for compliance (s 41( 5)); and.
  • The order or judgment on which the bankruptcy notice is based can not be more than 6 years old (s 41( 3)( c)).

Under what grounds could I counter-claim, set-off or cross demand?

To be successful using the grounds of counter-claim, set-off or cross demand, you will need to properly demonstrate to the court the following two items:

  1. The counter-claim, set-off or cross demand is equal to or more than the total amount claimed by the creditor in the bankruptcy notice. You must also satisfy the court that these claims are legitimate and have a reasonable likelihood of succeeding; and.
  2. The counter-claim, set-off or cross demand was not set up in the proceeding where the creditor attained the judgement on which the bankruptcy notice is based on. Failure to capitalise on the opportunity to counter-claim, including any adversarial personal circumstances (including lack of evidence or legal counsel), will not be adequate.

What is an Abuse of process?

An abuse of process materialises if you can substantiate that the reasons behind the bankruptcy notice is to pressure you to pay a debt, instead of a legitimate effort by the creditor to invoke the court’s jurisdiction in regard to insolvency. If the former is true, then you will have the option to set aside the bankruptcy notice caused by an abuse of process. To be successful using these grounds, you will need to supply evidence of collateral purpose or excessive pressure.

What If I believe I have grounds to act on one of these items above?

If you feel that you have a case for one of the previously mentioned reasons to contest your bankruptcy, you will need to get the following documents prepared, filed, and served for you to apply for your bankruptcy notice to be set aside:

  1. Application (Form B2); and.
  2. Affidavit.

Application.

You can locate the requirements for an application to set aside a bankruptcy notice in rule 3.02 of the Rules. You can either obtain a final order or an interim order.

Final orders have to describe the ideal result you aspire to receive and the legislative basis which the court can approve this decision. An example of a final order might be: “That bankruptcy notice (BN00231) issued on 15 June 2017, which was served to me on 1 July 2017, be set aside under section 30( 1) of the Bankruptcy Act 1966.” You would also have to present a copy of the bankruptcy notice with your application.

Alternatively, an interim order needs to outline any outcomes you wish before the application is finally decided upon, and the legislative basis which the court can grant this decision. An example of an interim order could be: “The time for compliance with bankruptcy notice (BN00233) be lengthened up to and including 7 days after the outcome of this application by the Court under section 41( 6A) of the Bankruptcy Act 1966.”.

Affidavit.

If you intend to make an application, it must be accompanied by an affidavit which cites the grounds of your application as well as the date the bankruptcy notice was served to you. If you’ve already made an application to set aside the judgement of the bankruptcy notice, a copy of this application/s also needs to be attached. It’s essential that your affidavit must fulfill rule 3.02 of the Rules, otherwise your application may be refused and your request for an extension of time to follow the bankruptcy notice may not be granted.

Filing your application.

When your documents are finalised, they will need to be filed with the courts either online or personally at the Federal Circuit Court Registry.

There is a lodging fee that will need to be paid, however in some situations you can apply for a waiver of this fee.

Serving your documents.

Once you’ve lodged your application and affidavit and they have been stamped, you must personally serve these documents to the creditor within three days after the documents have been lodged.

If you are an individual, you must personally take the documents to the person identified on the document and give it to them. If they decide not to receive the documents, the person serving them may place the document in the presence of the person to be served and verbally instruct the individual what the documents consist of.

If you are an organisation, you must personally go to a registered office of the company and hand the documents to a person servicing that organisation. You don’t need to present the documents to the company’s principal address, the Australian Securities and Investment Commission (ASIC) will provide you with a list of that organisations registered addresses.

If you would prefer somebody else to serve the documents, you can get a bailiff of the court or a process server to serve the documents for a fee.

Financial Advice.

If you’re not sure whether you have grounds to set aside the bankruptcy notice, or you’re unsure whether you should spend the time and money to apply because of financial reasons, speak to Bankruptcy Experts Tamworth on 1300 795 575 for free advice. Alternatively, you can visit our website for more information: www.bankruptcyexpertstamworth.com.au

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Australia’s Household Debt Crisis Looms

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Today in the news, former economics advisor John Adams proposed that Australia is too late to stop an ‘economic apocalypse’ regardless of his repeated warnings to the political elites in Canberra. He continued to urge the Reserve Bank to raise interest rates to stop household debt getting further out of hand.

This bubble is easy to explain. Confidence! It’s the fallacious perception that Australia’s last twenty years of continued economic growth will never encounter any type of correction is most distressing. Australia survived the GFC and a mining boom and bust. In the meantime, Melbourne and Sydney house prices have not missed a beat or taken a backward step. Sadly, the decision makers and powerful elite in Australia are from these two cities, and see Australia’s economic hurdles through a totally different lens to the rest of the country. It’s a two-speed economy spiralling out of control.

I acknowledge that this looming crisis isn’t just as simple as house prices in our two biggest cities, but the average house prices in these cities are ever rising and contribute significantly to overall household debt. The authorities in Canberra realise there’s an overpriced house market but appear to be reviled to take on any genuine actions to correct it for fear of a property crash.

As far as the rest of the country goes, they have a totally different set of economic prerogatives. For Western Australia and Queensland specifically, the mining bust has sent house prices tumbling downwards for years now.

Among one of the warning signs that demonstrate the household debt crisis we are beginning to see is the increase in the bankruptcy numbers across the entire country, particularly in the 2017 March quarter.

(source: https://www.afsa.gov.au/about-us/newsroom/media-release-regional-personal-insolvency-statistics-march-quarter-2017).

In the insolvency sector, our firm are noticing the damaging effects of house prices going backwards. While it is not the leading cause of personal bankruptcies, it definitely is a decisive factor.

House prices going backwards is just part of the issue; the other thing is owning a home in Australia enables lenders to put you in a very different space as far as borrowing capacity. Simply put, you can borrow far more if you are a home owner than if you are not a home owner. I bankrupt people everyday and the level of debt varies considerably from the non-home owner to the home owner. Lending is hinged on algorithms and risk, so I suppose if you own a home you’re more likely to have consistent income and less likely to end up bankrupt, so subsequently you can borrow more. If you own a home in Sydney and Melbourne, you’re a safer risk than if you own a home in Mackay, simply due to the fact that in one area the median house prices are booming and the other is going backwards, as it’s been doing so for years.

In conclusion, it seems we are running into a wall at full speed, and there are very few people suggesting we slow down. If you would like to know more about the looming household debt crisis then phone us here at Bankruptcy Experts Tamworth on 1300 795 575 or visit our website for more information: www.bankruptcyexpertstamworth.com.au