Get Out Of Debt

Debt problems don’t just go away, and yet the fact is: people write off debts every day. Lots of them. Every single day. How? It’s a combination of things: of small beginnings and big dreams; of simple solutions and hard work. There’s no magic formula for clearing debt, but there are plenty of practical solutions and there’s all sorts of help available too. If you want to clear debt, you can start straightaway.

First things first; make sure you’ve read through this website. If you want to know the difference between good debt and bad debt, or find out about factoring, or about where to go for advice; it’s all here.

Whatever else you do; budget. Budget monthly, fortnightly weekly, or according to when you get paid. Just make sure you keep a comprehensive record of your outgoings (usually lots of them) and your income (usually rather less of this!). The first benefit of recording your expenditure is that it will help you to determine exactly what you spend and why you spend it. Which bits count as essential expenditure; which bits don’t. The next benefit is this: as soon as you get into the habit of tabulating your weekly/monthly spend; the chances are you’ll stop spending it! Or stop spending quite as much anyway. There’s nothing quite so effective as seeing it all written down to bring a newfound fervour to your financial planning. Be strict. Everything goes down. Nothing gets overlooked.

Here’s another one: ever considered paying off your credit card debts fortnightly? What’d be the point? Think about it; instead of paying off £100 a month, you pay off £50 every fortnight; that means you’ll pay off an extra £100 a year. Increase the amounts and the savings will be proportionately greater. Bottom line: you incur less interest and you’ll be able to settle your bill a lot faster.

It’s important to think about the little things that can make a big difference. Are your repayment plans tailored to your needs? If not, think about how you could improve them. Do your bills arrive at the worst possible time every month? If so, change your billing cycle. It’s easy to arrange, and it can make your monthly repayments easier to stomach.

Don’t forget to work with your creditors. Negotiate with them; appeal to their better nature; anything, just make sure you talk to them. Let them know what’s going on. Some months will be better than others. Feeling flush? Find out whether you can pay back a little extra without being penalised. Some months will be worse. If you’re finding it hard to make ends meet, then tell them. Nine times out of ten, they’d rather accommodate your requests than turn a deaf ear to a long term customer.

Above all, be realistic about your debts. You may not countenance the idea of a loan, but you can at least work out if it would make you better off. Calculate how much interest you pay per month on your existing debts and work out how long they’ll take to re-pay. Then repeat the process for the best value loan you can find. How do the figures compare? It could be that a loan will work out more cost effectively in the long run. Find out.

Remember, you can get assistance with this if, like so many of us, numbers aren’t your thing. Don’t ignore the help that’s waiting at the end of the telephone. There are all sorts of experienced advisors willing and waiting to give you the benefit of their knowledge and experience. Use them.

And perhaps that’s the secret; if there is one: repaying your debt may be your responsibility, but you don’t have to go it alone. It doesn’t matter how many creditors you’ve got. It doesn’t matter how big your debt is. You can beat it.