Text version: To the max

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May 2012

Comic on credit, mobile phones, loans and owning a car

Comic transcript starts
Sammie: Hey Josh, did you score a DVD?
Josh: Sure did, sis! The bank upped my credit card limit to $5000. I've maxed it out already!
Lena: He got this camera phone too. You can surf the Web and play wicked games! Hey Josh, your SMS horoscope came through!
Sammie: Wish I had a phone like that. Hey, it's Kaz's birthday soon. I want to get her a pair of jeans like yours Lena, if I can afford it!
Lena: Pretty expensive present! These jeans cost $120!
Sammie: Kaz always gives me expensive things.
Josh: Woo-hoo! My horoscope says I'm in for a BIG surprise!
Mum: You kids seem to have a lot of money to throw around! Josh, your apprenticeship doesn't start for another month ...
How are you paying your bills? And what about the interest on that credit card?
Josh: Chill Mum! I'm doing heaps of shifts at the Pizza Palace. Anyway, YOU buy stuff on credit all the time!
Mum: I'm trying to keep this house running son! We're behind in rent, the car rego is due ... I hate putting things on credit, but I'm stuck.
Josh: Talk to the hand, Mum. C'mon Lena. I'll drive you home.
Lena: Maybe your mum's got a point, Josh - paying off this car, plus insurance, must cost loads! And you're using your mobile heaps ...
Josh: Relax babe. I'm a bit behind but I'll catch up. Anyway, the car came with insurance, so I'm sweet.
Lena: Thanks for the ride.
Josh: Yo, Mario. What's up?
Mario: Sorry about this, mate, but we're cutting your shifts at the Pizza Palace.
Josh: But I've worked there for three years!
Mario: I can't afford you, mate. You're 18 now. Too expensive!
Josh: So much for my surprise. Oh man. I'd better email Lena a video message and tell her.
Bad news, Lena. I've lost my job and … CRASH ... What the *%#$#!
Sammie: Mum, I need a mobile like Josh's ... it's really cool ... but my part time job at the bakery isn't enough to pay off a contract. Can you help me?
Mum: Sorry luv. Can't you get a pre-paid? Josh's phone may look cool but there is nothing cool about a huge bill every month! With a pre-paid you buy a phone card from the newsagent and stay in control of the costs...
Sammie: Mum's got a point ... I could save money for other stuff ... like that holiday for Mum.
Josh: Don't freak out, Mum, but I was in a crash! My car's a write-off.
Mum: Oooh! Thank goodness you're not hurt! At least you've got comprehensive insurance.
Josh: Not anymore - I couldn't keep up with the payments. I thought I was OK with 3rd party personal insurance (read note below), but the cops reckon it won't cover me for damage to my car or the car I hit. It gets worse… I took out a loan to buy the car. So now I have a debt but no car!
Mum: You need to speak to a financial counsellor, love.
Note: * 3rd party personal insurance (also known as a Green Slip) is compulsory insurance that covers passengers, the other driver, or pedestrians, against injury. To protect the other car you need 3rd party property insurance and to cover your car as well, you need comprehensive insurance. This costs extra, but could save you loads if you have an accident.
One week later...
Sammie: I wish I could stay at your place, Kaz. Things are pretty heavy round here ...
Kaz: Poor Sammie ... but cheer up, only two more sleeps till my birthday! Can't wait to see what you're getting me ...
Sammie: If I save $30 a week for six months I'll have enough for a holiday for Mum … Let's see ... there are 26 weeks in 6 months ... so if I save $30 each week, that works out at ... 26 x $30 = $780 (holiday!)

And if I save another $30 for only five weeks I can also buy a pre-paid mobile! $30 x 5 = $150 (pre-paid phone and credit)I don't know if I can afford those ­­jeans for Kaz, though.
Sammie: Kaz, my present to you is a night out at the movies with me! And I'll cook dinner too ...
Kaz: I'd love that! I'm glad you didn't say you got me clothes. I'm soooo over all the brands. I hate being a walking ad. Like doesn't anyone dress like an individual anymore??
Sammie: A walking ad. That's so true!
A couple of months later...
Mum: The phone company says if you don't pay your bill they'll take you to court! And the interest on your credit card is through the roof ... plus the car!
Josh: It's OK, Mum ... I spoke to a financial counsellor. I've called the phone company and the lender and they've given me extra time to pay.

I've cancelled my credit card too. I'm going to pay them all off in small amounts.
Mum: Groan ... you're going to be in debt for years!
Josh: [THE BIGGER PICTURE] Yeah, Mum, but there's no quick and easy way out. I might already have a bad credit
rating* (see note below) for being behind on my payments, which could stop me buying another car, or even an apartment when I'm older.
Mum: From now on, let's promise each other to try and save up for the things we need.
Josh: Yeah, we don't need this stress!
Note: * A bad credit rating is a public record of any unpaid bills (such as gas, electricity or telephone) or loans you might have. Banks, retailers, mobile and credit companies check these records when anyone applies for credit.
Six months later...
Sammie: Are you guys going out tonight?
Josh: Nah, no money, sis. Most of my pay from my new job goes towards my debts, but they're getting smaller.
Lena: But at least you're in a better mood these days now you've sorted out how you're going to pay your debts off.
Josh: Yeah, and it's good to be back in control. And in a few months I can start saving for a new car too ... with full insurance of course!! Have you told Mum about her surprise yet?
Sammie: Nope ... she's just about to find out.
Mum: What's this brochure, kids?
Sammie: It's your holiday, Mum! I saved up and bought us two tickets up the coast!
Mum: I can't believe it! Thanks Sammie! And a few months ago, I arranged to have some of my pay transferred to a separate account. Now I've got some savings set aside so, Josh can come too, plus we've got some spending money!
And so...
Sammie: Now this is living to the MAX! TRUE! Yeah, and without the monthly bill!

Josh & Sammie's cash tips

Sammie: If you get used to handling money when you're our age you won't get stressed like Mum did. Try keeping a diary of what you're spending so you know exactly what's going on.
Josh: Getting ripped off sucks. If you want a mobile, car finance or credit card, shop around and ask questions.

If bills are coming in, try to pay off the whole balance every month. Otherwise it could take years to pay back.
Sammie: Watch out for fines. They add up! And if you're buying a car, don't feel pressured to sign up for finance with a car dealer. Suss out your other options with a bank, credit union or building society.

Need help? Get FREE advice!

Australian Securities and Investments Commission
ASIC Infoline: 1300 300 630

Kids HelpLine: 1800 55 1800
LifeLine: 13 11 14
Reach Out: ReachOut.com

National Debt Helpline: 1800 007 007
The free hotline is open from 9:30am to 4pm, Monday to Friday. When you call this number you will be automatically transferred to the phone service in your state.

Legal Aid ACT: 1300 654 314
Consumer Law Centre of the ACT: 02 6257 1788

Consumer Credit Legal Centre NSW: 1800 808 488
Legal Aid NSW: 1300 888 529 or 02 9219 5000
Redfern Legal Centre: 02 9698 7277

MoneyHelp: 1800 149 689
Consumer Action Law Centre: 1800 466 477 or
03 9629 6300
Victoria Legal Aid: 1800 667 402 or 02 9269 0120

Legal Aid Queensland: 1300 65 11 88
Caxton Legal Centre: 07 3214 6333

Consumer Credit Legal Service WA: 08 9221 7066
Legal Aid Western Australia: 1300 650 579

Consumer Credit Helpline (Hobart Community Legal Service): 1800 232 500
Legal Aid Commission of Tasmania: 1300 366 611

Northern Territory Legal Aid Commission: 1800 019 343

Legal Services Commission of South Australia:
1300 366 424


To the Max was produced by Streetwize Communications with funding from the Australian Securities and Investments Commission (ASIC).

Thank you to all the young people and organisations who took part in the development of this resource. Writer: Libby Varcoe. Artist: Ross Carnsew. Project Manager: Jo Taylor

While we have checked everything in this publication, no person should rely on this contents without first making their own enquiries and obtaining advice from a qualified person.

ASIC and its collaborators are not responsible for the result of any action taken as a consequence of anything contained in this publication or for any error in or omission from this publication.

Last updated: 23 Aug 2018