If you’re in financial debt, you’ll know just how stressful it can be. A weight that’s always on your mind, financial debt (if not managed properly), can completely take over your life, with potentially disastrous consequences. However, as long as you acknowledge the issue early and make a concrete plan to suit your needs, you can get yourself back on the right track. Here are our top tips.
Small Debts: Plan Out Your Spending
If you’re in a relatively small amount of debt thanks to a Christmas splurge, then you’re not the only one, with research showing that the UK spent £1.5bn in loans and on credit cards in November as people planned for Christmas.
If the debt you have is short term, then by thrifty saving and careful planning, you should be able to recoup it, getting you back on the straight and narrow in a matter of weeks or months depending on its scale. To do this, set up detailed expenditure spreadsheet so you can track your outgoings and target areas to save money. By doing this, you’ll be able to visualise your outgoings, and it’ll be far easier to save.
Medium Debts: Get Rid of Costly Options
If your debt is slightly longer term than this, then it’s wise to work towards short term goals. By doing this, you’ll be able to feel as though you’re working through the debt, bringing it down to a more manageable level. The best way to do this is to take a close look at the structure of your debt. If, for example your debt stretches over 2-3 credit cards, then it’s wise to pay off the most expensive one first. Once you’ve done this, cancel it so that you can’t use it again. By getting rid of costly options first, you’ll free yourself up faster, and ease psychological stress, too.
Large Debts: Sale of Large Assets
Finally, if your debt has progressed beyond this level and you’re seriously struggling to keep up with repayments on your debt, then it may be time to consider more drastic action. Consulting with the Citizens Advice Bureau can be helpful here, as they can provide independent advice.
Sadly, the sale of large assets, such as your home, may be the only option depending on the scale of your debt. But, by getting a quick sale online, you’ll be able to downsize your home and pay off your debts in the process, meaning you can start afresh.
To conclude, debt is a very serious matter, and one that should never be taken lightly. However, if you recognise the problem early, and prevent it from escalating, you have every chance of recovering quickly.