Dun & Bradstreet, the consumer credit bureau, has waned that financial stress could rise as the Christmas holiday period approaches. It is usual for consumer debts to accumulate during the end-of-year holiday period.
Dun & Bradstreet saw a 15% rise in debt referrals in January 2013, up from the last quarter. At the same time, the Consumer Financial Stress Index peaked at 24.9 points.
While post-election confidence, higher savings, and low interest rates have reduced financial stress across Australia, Australians are being urged not to overspend during the holiday season.
Changes to credit regulations means that missed bill payments will be recorded on credit files. The expected rise in interest rates in 2014 means that households have another reason to spend carefully.
Consumers should seek out competitive rates for their home loans and pay down personal debt such as credit cards. Avoid paying high interest on credit cards by switching to lower rate cards or using only debit cards. Finally, every household should use a spending budget to track its spending.