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Astute East Brisbane's Finance Insights

Drawing on his industry experience, Tony Duncan shares his thoughts on industry changes, home loan requirements and a number of important areas to consider when planning your first home purchase or your next property investment. 

  • Writer's pictureSteve Dart

POV: Debt Consolidation in 2023

With the current cost of living crunch and increase in inflation, it’s not surprising that for many of us, in fact, 4 in 5, according to a recent Finder survey (83%) (December 2022) have put in place financial goals for 2023.

In reaching those financial goals, a natural first step is to find a way to simplify the number of monthly bills to pay. We’re regularly asked about the concept of Debt Consolidation, and whilst it works for some, there are some important points to consider. Here we’ve prepared an overview of the topic of Debt Consolidation.

What is Debt Consolidation?

pile of paper bills and paperwork
A common goal of reducing many bills down to one.

During the year, different debts can creep up and paying multiple bills with different repayment terms can become complicated. Debt consolidation can help bring all your existing debts together into one loan, with the goal of offering you greater control of your financial situation.

If you have a home loan, you can use the equity established in your property to roll up all these smaller amounts into one easy-to-manage payment. Sounds simple, but there are a few tricks to getting this right.

How does debt consolidation work?

Debt consolidation is bringing all your existing debts together into one loan, and then paying back this new loan with a single set of repayments over a set term.

Different times of credit facilities you could look to consolidate into your home loan could be:

● Credit cards

● Personal loans

● Car or Equipment Loan

● Study loans, including HECS or STSL

● Trade tool loans

● Tax debts

To help simplify your financial situation, it could be an option to consolidate all these debts into a single loan that could give you more certainty and control. Doing so could mean a lower interest cost and a clear understanding that you’ll be debt free.

Why consolidate your debts?

● One single set of recurring repayments that are easier to manage

● A clearer timeline of when you can be debt-free

● Greater control of your budget and cash flow.

What are the disadvantages of debt consolidation?

Whilst seemingly a simplified solution, combining all your debts into your home loan is not always the answer. After all, you will have your house for much longer than you would normally have your car.

Debt consolidation still requires financial discipline and may not be a good idea if you already have difficulty making your repayments.

By leaving your repayments the same and not increasing them in line with the new debt serviceable, you will essentially defer the consolidated amount to the end of the loan and will be paying interest on it over several years.

In these cases, we have strategies to help you save on interest and pay out the consolidated debt faster.

How do we review your situation?

When you are our client, we’ll undertake a comprehensive review of your current outgoings. We look at all the costs. It’s important to remember that when it comes to debt consolidation, interest is one part of it, but if there are costs for the early payout of a personal loan or car loan, you may become unnecessarily penalised.

Where to from here

Feel free to reach out to us for a no-obligation conversation. We’re here to help, and we will be pleased to talk you through the pros and cons of each scenario to help you understand what will be most suitable for your circumstances.


Astute Financial Management Pty Ltd | ACN 093 587 010 | Australian Credit Licence 364253 | Davgan Insurance & Wealth Pty. Ltd. T/As Astute East Brisbane Corporate Authorised Representative (425641) of Alliance Wealth Pty Ltd | ABN 93 161 647 007 | AFSL 449221. | General Insurance provided by Astute Insurance Pty Ltd | ABN 59 622 582 236 | Authorised Representative of Ausure Pty Ltd ABN 94 096 971 854 AFSL 238433. Health Insurance products are underwritten by St Luke’s Medical and Hospital Benefits Association ACN 009 479 618 (St.LukesHealth), a registered private health insurer, [trading as Astute Simplicity Health] and members are introduced by Astute Financial Management Pty Ltd or related entities (collectively known as Astute) for which Astute receives a commission.

General Advice Warning: This communication contains general information only and in no way constitutes the provision of professional advice, nor should it be relied on as a substitute for financial, credit, accounting, legal or other professional advice. We have not taken into account your financial situation, investment objectives or particular needs. Before making an investment or financial decision, a person must seek appropriate independent professional advice and also consider whether this information is appropriate to their needs, objectives and circumstances. The author as well as their representatives, agents and employees give no guarantees and make no representations, express or implied, as to the accuracy, currency, completeness or suitability of the information contained in this document. Nor do they accept any liability whatsoever as a result of any information herein being incorrect, incomplete or unsuitable or as a result of a person in any way using or relying on the information herein.

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