Ten steps to get out of debt

If you are struggling with debt, and constantly trying to make ends meet but feeling like you are not getting anywhere, take a minute to think long and hard about what you are spending your money on.

Here are ten pointers to help you get back on track.  

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1. Write down exactly how much you owe and document who you need to pay back and how much on a monthly/weekly basis. You do need to be honest even if it is difficult to see it in black and white. If your outgoings are covering debt like credit cards, pay day and other unsecured loans, that you are barely paying the minimum monthly payments on, then you may need to seek professional advice. There are many free debt advice companies for example StepChange Debt Charity https://www.stepchange.org/ that have people who can help you take the right steps.

2. Document how much money you have coming in each month. By documenting all of your outgoings you will have a clear picture of how you can budget and where you may be able to cut down in order to clear your debts quicker.

3. Try not to take on any more debt until you have repaid what you have borrowed.

4. Try to limit your daily/weekly spending by paying for everything in cash and leave your bank card at home. This will seriously make you question whether you need your daily caffeine fix on the way to work, or purchasing expensive take away food at lunch time. If need be make a flask and a sandwich at home and take to work.

5. Set up Direct debits to pay for your utility bills. This is by far the easiest way to manage your finances and sometimes the cheapest option, with some suppliers offering reduced payments to direct debit payers.

6. I know you have heard it before but you do really need to switch your utility suppliers. There are 100s of saving available to you, if only you could make the time to look about. And remember the more you save the quicker you can clear your debts and sleep easy at night.

7. If your credit is good you could look at switching your credit and store cards if you have them to 0% or lower interest rates than the cards you have already. There are some excellent deals at the moment so get searching. You could also make the most of the very low interest rates available for unsecured loans and consider consolidating your existing debts into one lower payment each month.

If you credit is not so good you could consider asking a friend or family member to be a guarantor. There are also some excellent lenders available to consider consolidating some of your more expensive debt for example pay day loans into one longer term loan. This will enable you to reduce your debt in a specific time period and also start rebuilding your credit file at the same time. Search www.guarantormyloan.co.uk for some of the best guarantor loans available.

8. If you have store cards then stop spending on them at the very least. Again, leave them at home or cut them up. If you are limiting yourself to cash payments then it will make you think again before spending your hard-earned cash on an item that you don’t need or probably even want.

9. If you are constantly into your overdraft each month or paying high charges for being overdrawn you may want to consider changing your bank account. Bank switching became easier in September 2013, with banks launching a guarantee to ensure all incoming and outgoing payments will get moved to your new account within seven working days. All UK’s major current account providers are involved in the new switching guarantee. So, if you think this will get find out the best switching deal by searching the internet.

10. If you have a mortgage you may want to consider talking with your current provider or an independent financial adviser about the options available and whether you could save yourself some month.

Remember if you are struggling there is free debt advice available at StepChange Debt Charity https://www.stepchange.org/

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