Dealing With Debt
Money worries are something that can affect anyone- whether you live on your own, with a partner or a family it can happen at any time for various reasons. When this happens it is important to be aware of your circumstances and to get the right help and advice.
Don’t ignore it
Ignoring calls for payment, bills etc will only make matters worse. It is better to look at what you owe and take steps to repay it. Contacting creditors straight away often works better as they will be more likely to want to work with you in order to get their money back. Furthermore failing to respond could result in legal action or additional costs that would add to your debt.
Prioritise
Essential there are three kinds of debt that can occur- emergencies, priorities and non-priorities. For example, if your boiler is broken and you can’t pay for it then you may have to get a loan for it.
In terms of priorities paying rent, mortgage and so forth. Non-priorities could be something like owing friends or family money- while you may want to pay them back it is more likely that they will understand if you are not able to do so immediately.
Learn to budget
Little things can make a big difference when it comes to saving money- switching to a cheaper brand, taking a packed lunch to work and walking instead of taking the bus are just a few examples of ways to reduce costs.
Switch cards
If you owe money a 0% credit card may be a better option- a lot of cards will have this as an introductory rate for a set period of time. If you are not sure you can pay off this amount a low rate card may be a better option for long term debt solutions.
In some cases a loan may actually offer a better rate than a credit card so it is worth shopping around to see what is the best deal (it may be worth getting a credit report first to see what is available to you as well as correcting any errors).
Debt management plan
This is a method where a financial company sets up a deal with your creditors to pay them off. Another option could be an administration order (if you’ve had a County Court Judgement or High Court Judgement against you) or an Individual Voluntary Arrangement that can be arranged through an insolvency practitioner.
Get advice
Talking to organisations such as Citizens Advice Bureau can give you guidance as to what to do with debt- what you will do will depend on the amount you owe and your personal circumstances.
We are here and available if you are worried about debt and want to discuss your debt please contact us today. We know it is a difficult situation but at Larcomes Financial Services we have the experience to help you get you through this and help you improve your financial situation in the long term.