How to Prioritise Rent, Food, Debt and Other Expenses
When money is tight, prioritise expenses in this order: housing (rent or bond), food and essentials, utilities, transport, then secured debts, then unsecured debts, and finally non-essentials. Secured debts protect assets like your home and car, so they rank above unsecured credit. If you cannot cover essentials and debt together, a financial assessment can clarify your options.
Key Points
- Housing, food and utilities come first.
- Secured debts rank above unsecured debts.
- Non-essentials come last.
- If essentials and debt conflict, seek an assessment.
Tier 1: Survival essentials
Housing, food, water and electricity are the foundation. Without these, nothing else functions. Direct your first available funds here, every month, without exception.
These are the expenses that keep a roof over your head and food on the table.
Tier 2: Transport and secured debt
Transport to work and secured debts (home loan, vehicle finance) come next, because they protect your ability to earn and your key assets. Losing a car can mean losing a job, so protecting transport is often essential.
Secured creditors can repossess the asset if you default, so these debts carry higher stakes than unsecured ones.
Tier 3: Unsecured debt
Personal loans, credit cards and store accounts come after essentials and secured debt. These matter, but they should not displace your ability to live. If you cannot meet them alongside essentials, communicate with creditors early.
If unsecured debt is unaffordable even after prioritising, debt review may be worth exploring.
Tier 4: Non-essentials
Entertainment, dining out and discretionary spending come last. This does not mean they are forbidden — a small allowance helps you sustain the budget — but they must not come at the expense of the higher tiers.
When income is under pressure, this tier is the first to reduce.
Frequently Asked Questions
Worried That Your Debt Has Become Unaffordable?
Debt Guidance can assess your income, essential expenses and debt commitments to determine whether debt review may be appropriate.
Reviewed by Carolina Guevara Harris
Registered Debt Counsellor · NCRDC3152
Last updated: 17 September 2025
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