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Debt is a way of life in Australia.
It’s commonly accepted that in order to get ahead and build wealth, at some stage you are probably going to need to borrow some money whether it’s to fund your university education, buy a car or purchase your first home.
Of course as we all know, there’s good debt and there’s bad debt. While overspending on your credit card once in a while is ok (provided you pay the amount off before you start getting charged interest), things can quickly turn a dangerous corner if you start to let your repayments go and allow you balance to start creeping up. Before you know it, you’re up to your ears in debt and can’t see yourself getting out any time soon.
Unsurprisingly, the group of our society that is most likely to find themselves in this revolving cycle of debt are those who are already seriously struggling financially. I’m talking about the one in five Australians who live on less than $397 a week.
While the banks won’t generally lend to people with this level of income, unfortunately it’s these sorts of people that smaller scale lenders tend to prey on.
Imagine you’re struggling to make ends meet and your fridge suddenly carks it. A “buy now and pay nothing for 24 months” offer would seem pretty attractive right? The trouble is that these small-scale loans have huge interest rates associated with them and often leave people already struggling in a constant circle of debt.
Thankfully, some organisations are starting to pop up in Australia that aim to combat this massive issue through low interest microfinancing.
One such organisation is Good Shepherd Micro Finance, a not-for-profit organization that provides small,l no interest or low interest loans (up to $3000) for essential items and educational costs. Along with fair, people-focused loans, Good Shepherd also provides free financial advice to help people understand their finances and financial management Melbourne.
Good Shepherd is currently funded by the Federal, Victorian, New South Wales and Queensland governments along with the National Australia Bank (NAB). What do I like most about organisations like Good Shepherd? The fact that they help people help themselves by learning how to form good financial habits.
Check out one of their inspiring stories here.
If you or someone you know is in a dangerous financial situation, it’s worth paying a visit to these guys and chatting to them about how they might be able to help. More at www.goodshepherdmicrofinance.org.au.