Australia has one of the highest personal debt levels in the world.
Credit cards, car loans, home loans, HECS etc.
What is yours?
How Much Debt Are You in?
freshofftheplane on 30/05/2021 - 10:16
Last edited 30/05/2021 - 14:47 by 1 other user
Last edited 30/05/2021 - 14:47 by 1 other user
Poll Options
- 498None
- 81$1-10,000
- 322$10,001-100,000
- 537$100,001-500,000
- 329$500,001-1,000,000
- 145$1,000,001-2,000,000
- 90More than $2,000,000
Comments
It's a debt right?
Some of the perma-students I know would argue it’s not since they will never earn enough to have to pay it back…
You will have too otherwise it will affect your future credit. When I bought my first property they didn’t ask about HECS. Many years later I moved house and bought a different property and they reviewed my HECS and reduced my borrowing power due to it.
@TheBilly: Basically what they'll do is reduce your income for the purposes of assessing your borrowing power by the amount you are obligated to pay towards HECS. ie. you earn $75,000 and therefore pay 4.5% of that towards your HECS debt each year. Therefore when you go to borrow, the lender will treat you as having an income of $75,000 - 4.5% = $71,625 (not accounting for any other lending considerations).
Damn, imagine graduating and not being able to earn more than $47k a year…
@FareEvader: Some don't by choice. Everyone is different, some are happy earning below 47k, especially if they are self employed or prefer having free time to pursue their hobbies.
@FareEvader: If you don't have kids it's easy. I was living on between 12k and 20k p.a. as a student, and that included accommodation, travel costs to work (etc) with no assistance from anyone.
I don't spend that much more now. about 60% of my income goes towards paying off my loan and investments.
@[Deactivated]: my investment pay for up to 50k luck if spent 24k with waste money on Oz bargain shit last year only 16k dew covid next zero meal out. i do work little but just want see and meet people other wise see no body.
@FareEvader: you earn a larger unofficial figure, get paid in cash, have company pay for stuff ect - be creative
but even without all that i supported a family of 3 on 58k
100%
Yes. The bank made us pay out our HECS as a condition for a new mortgage.
Which chumps were these?
how i check my debt?
@capslock janitor: There’s no central repository. You need to know who you owe, or eventually they’ll come looking for you I guess.
You went along with it ? Should of gone elsewhere.
I suspect it was they wanted to increase the serviceability. They calculate the % deduction as an ongoing expense regardless of the total outstanding debt. For my wife and they discount your income at 10+% so paying it out is the only way to get them to exclude it.
You should stay in uni
If you ask a Whitlam lover it really does!
Here is a good idea once you finish paying your hecs. If you don't notice hecs being taken out, i recommend you continue to pay hecs after your hecs is fully paid off. The reason why I say this, is because you will get a nice payout every tax time. Sure it would be nice to have higher pay, however when you have that extra money your wanting to spend it. my wife does it, i dont, every year she gets around 10k. Good for a holiday every year.
About $18 thousand in HECS quickly getting paid off. Otherwise nothing.
I have just over double that and this year will be the first time I am over the threshold which for me in my email was about $46,650 or something like that.
No idea how the repayment is gonna work out if it is just a lump sum every year at tax time or they are gonna start doing a monthly repayment thing or whatever.
But yeah besides my HECS debt I am pretty debt free luckily.
No house mortgage yet.
No credit card ever.
Yeah that is about it.
If you tell your employer you have a hecs debt they'll take it out of your pay with your tax
What details do I need to give them so they can link up my HECS debt with my tax?
If I don't go that avenue what other options do I have?
Like what would happen if I don't do anything and just leave it will they automatically grab it or will there be penalties?
@AlienC: I think you'll just get a tax bill. But you want to pay what you're supposed to before 1st June as that's when the indexing happens.
The money taken off your pay isn't applied to the loan until after the indexing so if you don't tell your work and pay it yourself that's actually better.
If you want to tell your work and get them to take it off for you, you should just have to tell HR or payroll and let them take care of it, they should just need your TFN which they'll already have. You lose the same amount no matter how big your loan is. If it is smaller it will just get paid off sooner.@Quantumcat: Thanks maybe I will send an email to payroll/HR later today saying I have a HECS debt and if they need anything from me.
Does that sound about alright?
@Quantumcat: Sent the email basically just said I have a hecs debt student loan and if they need me info from me to message me back.
Told them my tax file number should be on file.
Thanks Quantumcat.
Sent the email basically just said I have a hecs debt student loan and if they need me info from me to message me back.
You're meant to submit a withholding declaration to your employer
https://www.ato.gov.au/Forms/Withholding-declaration/
It's similar to a TFN declaration, but its purpose is to override any previous TFN declarations or Withholding declarations you've previously given to your employer.
@Tarkhein: do you have any idea what happens if say I don't do anything like will they just tell me how much I need to pay and I can pay it
will i incur some kind of penalty if so how much
I am definitely over the threshold (woohoo) this year :)
@AlienC: Adding to what @prmyab said about your employer just giving you the correct form to complete, if you don't submit the correct form to your employer, your employer won't change their withholding amounts and the only penalty is you'll see a larger net debt when you lodge your tax return for not informing your employer sooner (remember that the financial year is 1 July to 30 June, so informing them now will only increase the total withholding credits for the financial year by a small bit).
If your Notice of Assessment results in a debt you have difficulty paying off in one go, you can enter a payment plan in ATO online services (via myGov) or by calling the ATO.
@Tarkhein: Ok thanks i think i get it.
So i need to send the right form to my employer.
Who else can i speak to about this if i need more help or specially tailored advice on this?
Does ATO or is there some free help line or something especially for hecs debt type stuff, you have been a huge huge help so far heaps of thanks.
Does ATO or is there some free help line or something especially for hecs debt type stuff, you have been a huge huge help so far heaps of thanks.
If it relates to your tax return, your loan account, or repayments, call the ATO (contact page: https://www.ato.gov.au/About-ATO/Contact-us/).
@AlienC: It is a box ticked on the TFN declaration form, many employers seem to miss it (4 of mine have).
I have nearly 10 times that… Welp.
Medicine or law?
Dentistry
Random Q but if our HECS has been paid off after this FY, do we need to advise our employer to stop withholding a portion of our pay for HECS or is it automatically done?
Probably the better question is what is your debt to income, or net assets divided by age
Probably also worthwhile factoring deductible debt and utility vs investment assets into that mix
Then multiply by how far you can pee.
In feet or metres?
Minus the height of your leg. Known as P&L
I always wondered what PPOR was.
@Yarkin: Principal Place of Residence - Your own home which you have bought and currently living in.
No debt.
But I also have no car, property or permanent job.
I take public transport, rent a shared-house and work on a fixed-term contract basis.Are we brothers?
or at least half brothers?
I am the same except that last one I am on fixed contract for one and the other I am pretty much the permanent but still getting paid casual :)
raking it in - as a a coalition donor I was guaranteed vast returns on my investment from my buds - gonna write a book how to turn 50 grand into 5 million within 2 years……
Similar, but my rort's with the Labor party. All I had to do was attend a few dinners, talk to right people, shake a few hands, and now all my land is getting rezoned and my development applications are getting waved through.
so you got 30 million for land worth less than 3 million? good going mate but the real money's in defence contracts - look at how much my mate earned from those shit copters…and thats nothing to what's being earnt in NT.
Great days for small bungs, and you're guaranteed to walk with every investigative body stacked with other coalition associates. You just toss a big government contract employment to em, allow as many extra's as they can claim and everyone goes to the bank happy.
stuff the rest of you's, greed is great in OZ these days….gotta go so many rorts so little time…
It's okay to have $2 million in debt and $10 million in other assets to cover it, but it's probably not okay to have $2 million debt and no assets or anything else.
It'd probably be better to ask the amount of debt vs assets. (But then you're likely to get exaggerated answers anyway since everyone here is about 23 years old and on an annual salary of $300K/year! LOL)
I think 2.5 Mil in assets and 2 mil in debt is the worst case scenario if creditors call in the loan the fees will most likely wipe out everything .
it's probably not okay to have $2 million debt and no assets or anything else.
What are the creditors going to get 0 in the $ if called in .
What are the creditors going to get 0 to the $ if called in .
It's called declaring bankruptcy!
Surely if the guy blew 2 mil he had some fun is my main point :)
@popsiee: $2 mil is a good amount to be bankrupt over.. hahaha
Some people have done it over $50K. it's so not worth it!
@bobbified: I knew a bloke who did it over 23k of credit card and car loan debt. Thought he was a f’in genius!
@Gradesbrah: What's wrong with that? lol.
Admittedly, I was actually in that situation myself ($50K credit card debt) at one stage. It wasn't fun, but I eventually got off it with a couple of defaults, and managing to avoiding bankruptcy. The thought of declaring bankruptcy did occur to me, but like i said, it's so not worth it for $50K.
@bobbified: He was 19.
The guy defaulted to avoid paying debt, he then was in the local newspaper 4 years later complaining of rental shortage/no one willing to give him a mortgage. He forgot to mention the part where he declared bankruptcy.@Gradesbrah: Oh right! He actually went for bankruptcy over $23K and a car loan! 🤣
I'm surprised the court let him do it for such a small amount - If his car was worth anything decent, it would've been taken off him anyway to pay his creditors.@bobbified: This particular gentleman went to great lengths so they came for the car it was not worth their time. They took it, but I doubt the tow truck was covered by the remaining value.
gentleman
I wouldn't really call him a "gentleman"! lol I think he'll be regretting it now or in a few years time when he goes for background checks for things such as employment and they ask if he's ever been bankrupt!
"i declare BANKRUPTCY!!!"
All depends whether my eBay PLUSOFFER deals get delivered or not :(
Anyway my open question on the thread is someone owns fully a 1 mil house and has no income . Has 100 k in credit card 20% debt but because of no income the banks won't permit refinancing . Is there any solution besides selling the house on the refinancing side ?
Move out to a sharehouse and rent the 1 million dollar house out? Or if it has lots of bedrooms get lots of borders?
Bloody hell, 100k on CC and no job… get a job would be the best solution.
use whatever goodwill u have with your parents/family to clear the CC debt asap! 20k in annual CC interest jeebus. then what trapper said, find a job.
100k CC no job? Ring the issuing CC provider as you can get the interest stopped. Or I’d just default on the credit card as it’s unsecured debt. Then when the debt collectors start chasing me offer them a settlement of 10% of the value
Mortgage will be paid off by EOFY, inheritance should be coming in by August, retire in <5 years.
I'm sorry for your loss
I hope your parents are proud of you. Jesus.
Your amount of debt is irrelevant. Your ability to service the debt is relevant.
In other words, Australians are among those of highest capacity to service any debts.
please explain
Obese people mainly eat burgers and pizzas.
@Neoika: so you meant 'Australians are among those of highest capacity to service any debts' that they were all obese and ate just burgers and pizzas ?
wrong thread perhaps? or all australians are like yanks maybe?
@petry: Australians have the highest debt because Australians have the highest capacity to service that debt.
It wasn't that difficult to work out.eg. I have $1M in debt because I have the capacity to service $1M in debt.
I think it's great all the "$0 debt responses", but in this interest rate climate, it's not a very efficient use of money
@SlickMick: mate thats crap with falling real wages, covid, and national debt becoming a real issue. whats the justification for the assertion ?
besides murdoch shite and political ravings?
@petry: Crap? says you.
Justification? Simple maths. If you can't find an investment that pays better after-tax returns than current interest rates, don't get in debt.
Raving? I'll leave that to you.@SlickMick: assertion 'Australians have the highest debt because Australians have the highest capacity to service that debt.'
wheres your math mate? invisible ? evangelical?
present your math mate or keep your personal abuse where it really belongs
Does hecs count?