Planning your way out of debt
If you’re worried about debt, it’s essential to take action as soon as possible – but before you can do that, you need to understand what kind of action is required.
You might be able to pay off your debts by making some small changes.
You could:
- raise your income – by working some overtime, for example, or finding out if you’re entitled to any more benefits.
- reduce your expenditure – by giving up luxuries for a while, for instance, or by drawing up a realistic budget and sticking to it.
If you feel your debts are getting out of control, you might need to make some major lifestyle changes, if practical, such as selling your car or moving to a more modest home.
However serious your debts, you may benefit from seeking professional advice and / or looking into the various debt solutions available.
Finally, whatever you decide to do, you need to set yourself realistic goals – you can’t live without heating in the middle of winter, for example, or cut food bills down beyond a certain point.
It’s impossible to draw up a realistic plan unless you understand:
- which of your debts are the most important
- exactly how much money you have coming in – and how much of it is available to pay off your debts