Debt Relief – Paying bills when you have lost your job

The steps to take so you can meet your financial obligations if you’re unexpectedly out of work.


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Paying bills when you’ve just lost your job can be overwhelming to even think about, let alone achieve. But luckily, there is support available to you in these circumstances.

Banks and credit providers will work with you so you can pay your meet your financial commitments and manage costs in-between jobs. Here, we have also outlined steps you can take to ensure you have enough money to pay your bills if you have lost your job.

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Steps for paying bills when you have lost your job

Here are 7 steps to helping you to pay your bills, even when you're currently unemployed.

1. Calculate your savings

If you have savings, now is a good time to access savings accounts, deposits and other liquid assets, such as shares. Think about the outgoing costs you have and how long your savings will be able to support you so that you can focus on the most important tasks first.

2. Work out if you’re waiting on any outstanding payments

Outstanding payments come in the form of redundancy payments, income from assets and benefit payments. Take stock of income-generating assets such as rental properties and what you expect to receive each month.

Also factor in any benefits you can expect to receive in the future. For example, if you’re covered by income protection insurance, you can expect to receive a monthly repayment until you’re employed again. Credit card repayment insurance will pay up to a percentage of your outstanding balance each month if you've lose your job.

You may also be eligible for the Newstart allowance from Centrelink to help support you while you look for work, and the income support bonus. This is a bi-annual payment in addition to income support payments. Note that Centrelink benefits such as the Newstart Allowance are means tested.

3. Prioritise your expenses for the next two months

Start by looking at your regular and essential costs, such as groceries and utilities, before considering your ongoing debts. When it comes to debt repayments, you can divide them into unsecured and secured options.
For example, credit cards and personal loans are types of unsecured debt, while a mortgage or car loan is secured debt. Prioritise paying secured debts first, as creditors can reclaim assets secured to a debt if you don’t make repayments. But if it’s possible, you should always aim to pay at least the minimum required on all of your debts.

4. Work out your budget

Work out a budget so you know how long you will be able to live on your savings, outstanding payments and any income support payments you receive. Remember, this is your safety net and there is a chance that you could find employment sooner than expected. A budget can also help you cut unnecessary spending by showing you where the majority of your money goes.

5. Limit your spending

Using your budget, identify which expenses are your “needs” and “wants”. The expenses in your “wants” list can be cut to free up extra cash while you’re looking for more work. Gym memberships and other subscription services like Netflix are examples of “wants”, and can be cancelled or suspended while you’re looking for work.

6. Contact your providers

Reach out to your creditors and service providers and let them know that your employment circumstances have changed. They will offer you a range of options based on your individual situation.

You can also apply for a hardship provision to help meet your obligations. You have a legal right to vary the terms of your loan contract if you’re experiencing financial hardship, for example you can request a payment extension, an extension of the loan term so you have smaller repayments, or you can ask for a temporary hold on your repayments.

7. Continue seeking employment

This could include contacting colleagues and friends to see if they know of any appropriate opportunities you could apply for, updating your resume and connecting with people on services like LinkedIn. There are also employment agencies and placement services that could help you find secure or temporary employment.

You may also want to get the money coming in again by picking up odd jobs – whatever you have to do to avoid missing your repayments and damaging your credit file. Online work is more accessible than ever, and freelance work platforms such as Upwork, and Airtasker are handy when you’re looking to make a couple of extra dollars.

Should I use my credit card to pay bills when I'm unemployed?

Avoid using your credit card to pay your bills. Using debt to pay a debt is a slippery slope to financial ruin. Instead, consider seeking a hardship variation with your provider. You may also want to contact a financial help service to discuss your situation and get specific advice on how to manage your financial commitments.

Other options to consider

Consider the following options if you’ve lost your job and money’s tight.

  • Debt consolidation. Consolidate your debts using a debt consolidation loan. A debt consolidation loan can save you money by giving you a lower interest rate. Some lenders accept unemployed applicants.
  • Early access to superannuation. Have a look at your super balance to see if you have any unpreserved funds (contributions made before 1999). You can withdraw your superannuation balance early if you’re experiencing severe financial hardship. To be eligible for early access to your super, you need to have been receiving Commonwealth government income support payments for the past 26 weeks.
  • Emergency help services. Charity and community organisations can provide emergency financial assistance. If you have spent all your money paying your bills and do not have enough left for medical and other essential costs, contact a local charity or community centre. The Department of Social Services (DSS) can put you in touch with your local organisation.

There are numerous factors that weigh on your mind when you’ve lost your job, but it’s important to try to stay calm. Stop, breathe and take stock of your situation. Follow these steps to manage your finances and start seeking out employment and support where possible. It's important to focus on getting through this period and moving onto the next phase of your life.

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6 Responses

    Default Gravatar
    StephanieJuly 9, 2016


    I was made redundant back in April and have not been successful in obtaining full time work as of yet, even though I have applied for millions of jobs and attended a decent amount of interviews. Currently I cannot even afford food/petrol, let alone my debts such as my mortgage. I am also behind on every credit/debt/account I have such as phone bill.

    I was only able to apply for Centrelink assistance (Newstart & Low Income Health Care Card) due to receiving a small payout (which went to bills/everyday living and is already gone). Currently waiting on hopeful approval.

    I have seen a financial counsellor just recently who I did not find helpful as I do not have any income to be able to make a financial hardship arrangement with lenders, and I already know everything we discussed.

    I also tried to access my super but don’t qualify.

    I am at a loss. There is so much information for every other type of situation out there but mine.

    Any advice or assistance you could provide would be greatly appreciated.

      Avatarfinder Customer Care
      MayJuly 21, 2016Staff

      Hi Stephanie,

      Thank you for your comment and I’m sorry to hear about the difficult situation you’re going through.

      Just to confirm though that you have come through to we are an Australian financial comparison website and general information service. As we are not credit experts, we can only provide a generalised advice.

      As we cannot provide you with an expert advice nor recommend specific lender/credit card company to you, you might like to reconsider and try to contact your lender and discuss your present situation with them and seek options on how you’ll be able to waive fees/interest or maybe reduce your minimum repayments.

      You’d also be best not to stop looking for a job, though some of your applications may be rejected, that doesn’t mean you’ll quit, it only means that you have to keep looking until you get successful. Indeed, to figure out how to pay your bills when your debt gets out of control is hard, not mention to where to find means to provide and sustain your everyday basic needs.

      I apologise if I may not be able to give you the best advice, but I hope we’re able to encourage you to get on with your life, be positive and that in the near future you’ll be able to get through your difficult situation.


    Default Gravatar
    BevMarch 2, 2016

    I am unemployed, have debt and struggling every way financially. I don’t know where to turn to now. I have sold what I don’t need, and getting depressed. Help please.

      Avatarfinder Customer Care
      SallyMarch 2, 2016Staff

      Hello Bev,

      Thank you for your comment and we’re sorry to hear about your current situation.

      If you’re unemployed and looking to consolidate your debt, you might want to consider a loan from some of the lenders that accept unemployed applicants. You can compare your options using this guide.

      When comparing your options, make sure to confirm that you meet the eligibility requirements before applying as declined applications will have a negative impact on your credit file.

      I hope this has helped.

      Good luck!


    Default Gravatar
    JasmineMarch 23, 2015

    I currently have 3 debts that I have to pay off all of which I have applied for financial hardship for .
    I am currently unemployed so I am receiving help off my partner for now.
    All of my creditors are saying that they can assist me from 3 to 6 months but due to the difficulty of finding another job , I am worried that I will still be unemployed after the time limit. What would you recommend would be the best thing to do in my situation?

      Avatarfinder Customer Care
      JonathanMarch 23, 2015Staff

      Hi Jasmine, thanks for your inquiry!

      Please refer to the link I have sent to your email which will explain the options you can take in detail when you are in financial hardship.



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