If you`ve finished your university studies, it`s quite likely that the extent of your student borrowing has just begun to really hit you. It`s no longer uncommon for students to graduate with upwards of £20,000 of debt, and this can be worrying for a lot of people.
Before we start, it`s important to distinguish the different types of debt. Most students will have taken out a student loan from the Government - and this is totally different to the other debts you may have.
These loans are designed to be repaid slowly, and only once you`re earning above £15,000 a year. Repayments will be automatically taken from your salary as a small percentage of any earnings above this amount.
However, things like student overdrafts, credit card debts and any other borrowing outside your student loan could be more of an issue in the immediate future. You`ll need to take responsibility for repaying these - but if you start to struggle, you may need to get help.
First of all, take a step back and look at the kinds of debt you`re dealing with. If it`s an interest-free overdraft, a lot of account providers won`t start charging interest until a year or more after you`ve graduated. This means the debt can`t grow, so you`ll have some time to `find your feet` before interest can become an issue.
Others may start charging interest, in which case the debt can grow quite quickly and you may need to take action sooner.
Similarly, if you have credit card debts, your provider will require you to make minimum monthly payments. These shouldn`t come to much unless the debt is particularly big, so in the short term they may not be too much of an issue.
If your problem is more serious - if you`re falling behind on your credit card payments, for example, or you have a personal loan that requires regular repayments you`re struggling to meet - then you should contact a debt adviser to talk about the best way forward.
You may just need some advice on budgeting more effectively. Or, depending on your circumstances, you may end up looking into a credit card balance transfer, for example, or a debt management plan. A debt adviser can help you decide which approach is right for you.
If you`re struggling with debt and need help, click here for a free call-back at a time that suits you, or call us today on 0800 195 2911.
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