Now is the time to cut debt, says super fund

FOR many Sunshine Coast residents, becoming debt free can seem out of reach but it is certainly not an impossible goal, according to Queensland's largest superannuation fund.

ASIC's Money Smart website reveals nationwide around $32 billion is owed on credit cards, and close to 30% of Australians say they find dealing with money stressful and overwhelming.

QSuper CEO Michael Pennisi said with the Reserve Bank of Australia cash rate at a record low of 2%, it is a great time to tackle personal debt and in turn, build consumer confidence.

Tips for reducing debt

Where does your money go? Start a spreadsheet which lists all of your current debts with corresponding interest rates, remaining balances and payment dates. This will give you an overall picture of your current debt situation.

What are your high interest debts? If you have the capacity to make extra payments, focus on debts with higher interest rates.

Are you being realistic? When you're devising a budget strategy, plan for the worst case scenario. If you need to work out a payment plan with your creditors, ensure you have sufficient cash flow to meet the repayment schedule. You may be penalised if you have to renegotiate another payment plan.

How can you save more? By putting aside a small amount each week.