It’s no secret that things are getting more expensive.

Over the last few months Google searches for “the cost of living” have increased by 10 fold, and it’s no surprise. The price of vegetables has increased by almost 30%, some used cars are up over 45%, petrol is at the highest rate in history, and a string of interest rate rises have hit for the first time in more than a decade. Millions of Australians are feeling the financial stress of keeping a roof over their head, keeping the lights on and putting food on the table. So what’s going on?  

The answer is… it’s complicated. We have found ourselves in the perfect storm of frequent extreme weather events, the effects of climate change on crop production, pandemic-affected supply chains, and a war in Ukraine. And as a result of all of these factors which are very much out of our control, we are experiencing rocketing inflation and a cup of coffee will now set you back over $5. So how can young people, whose wages have been stagnating for years weather this storm and better understand their finances? 

Let’s talk about debt 

For as long as we have ascribed value to little disks of metal, we’ve been conditioned to believe that accumulating debt is a bad thing, and that we should aspire to have money squirrelled away for a rainy day. After all, the majority of us are paying off some form of debt whether it be a mortgage, a business loan, or a student debt – so owing money certainly shouldn’t be taboo.

Which is why our latest podcast, Life and Debt says it’s time we stopped demonising debt and started thinking of it as a part of life.  

Created by the Young Ambassadors from our Banking and Finance Oath (The BFO) initiative, this four part podcast series takes a deep dive into debt, what role it has in our lives and how we can make better decisions about it. According to Young Ambassador, Cameron Howlett we need to rethink our relationships with being in the red. “We wanted to encourage people to think, discuss and engage with the topic because if you’re uncomfortable with debt, you’ll never really have a healthy relationship with it.”   

Howlett hopes the podcast will encourage a more nuanced discussion about debt, “we all have some good experiences and bad, but what we have found consistently was that we were all a bit nervous about debt.” The series, which features financial advisors, journalists, finfluencers, psychologists and historians hopes to debunk the shame and stigma around debt especially for younger listeners. Cameron continues, “we want to get people from that step of being too terrified of debt or credit to be able to think whether or not it’s right for them”, so how can we be a little more discerning when it comes to different types of debt?    

“If you’re uncomfortable with debt, you’ll never really have a healthy relationship with it.”

The good the bad and the ugly debt 

During the pandemic, we all did our share of online shopping. Buy now, pay later services made it easy for us to get that instant gratification hit that comes with receiving parcels in the mail, without the ensuing depression that results from looking at one’s negative bank balance. These services posted huge profits during the pandemic, and because they’re so easy to set up and use, people are now using apps like AfterPay and ZipPay to purchase everything from a new outfit for the weekend, to groceries, and childcare. Unlike credit cards and banks, Buy now, pay later companies don’t ask any questions about whether their customers can actually afford to make the repayments, and as a result a lot of young people are racking up thousands of dollars in debt using these financial services.  

So what exactly is good debt and bad debt, and how can we differentiate between the two? 

According to Iqra Bhatia, a Young Ambassador from the Banking and Finance Oath initiative, “attitudes towards debt are changing, young people need to educate themselves more on debt and be aware of the resources available”. Instead we need to shift our thinking, “Afterpay is not that different from credit cards – it’s essentially the credit card of our generation.”

“Attitudes towards debt are changing, young people need to educate themselves more on debt and be aware of the resources available.”

It’s not all doom and gloom 

It’s clear we need to start understanding money from a younger age. While lessons in financial management traditionally consisted of a few pointers offered by parents at the dinner table, we are now starting to see financial literacy programs introduced in the high school curriculum. But more work needs to be done. 

Debt is something that, at different points throughout all our lives we will all encounter and take on, whether it be small, like agreeing to buy the next round at the pub, or a little more daunting like taking on a HECS debt at university or taking out a mortgage to buy an apartment.

Debt can be emotional, it can feel like you’re signing away a little piece of your freedom, but it can also be empowering and necessary. And debt is changing, we’re grappling with the buy now, pay later industry now, and what form debt will take over the next few years. Which is why it’s important to stay educated and in touch with our values so we can make decisions for our bank balances and our futures.  


Life and Debt is available to listen to on Spotify and Apple Podcasts.

This podcast is a project from the Young Ambassadors in The Ethics Centre’s Banking and Finance Oath initiative. Our work is made possible by donations including the generous support of Ecstra Foundation – helping to build the financial wellbeing of Australians.