Struggling with debt is very stressful for obverse reasons but many people who are struggling are also very embarrassed and ashamed. This means they often won’t seek out help and instead try to do everything themselves.
This can be a vicious circle because rather than solve their problems it can just make them much worse, especially if they can’t tackle the issue or issues that caused them to get into debt in the first place. Misconceptions about debt are very widespread and people can fall into debt for all kinds of reasons.
Getting into debt can be frighteningly easy and figuring out how to get out of it is usually much harder. Below we’ve outlined some tips that can help people who are struggling with debt get out, in many cases, it will be a long process (depending on the level of debt) but these tips can help you get out of the red and back into the black.
Seek Help If You Can’t Do It Alone
Because many people feel ashamed and embarrassed about being in debt they often won’t tell people even close friends and family about their situation. Or at least not the full extent of it, likewise this mindset carries over when it comes to organisation and groups who can help you.
Citizens Advice and other specialist groups like National Debtline are just two names everyone can turn to for free advice. There are many more groups out there who will be able to help so if you’re struggling with the pressure there are people out there who can help you.
Talk To Your Creditors
People are rarely in debt to just one creditor, it might start out that way, but things can quickly spiral out of control. But one mistake many people make is that don’t talk to their creditors about their problems when in many cases it would be in their best interests to do so.
If you talk to your creditors you might be able to get your interest frozen for a period of time, this will help make paying off your debts much easier. Or they may agree to reduce your payment amounts and remember the groups we mentioned in the first tip can help you with this.
You might also be able to set up an individual voluntary arrangement, commonly known as an IVA this agreement will be set up with your creditors. With an IVA any payments will be made to an insolvency practitioner who will then pay your creditors equally this process will continue until the whole debt is cleared. For more information about IVA’s click here
Avoid Pay Day Loans
Payday loans have certainly made a name for themselves, there are a lot more of them about nowadays and they can be very tempting for people who are struggling with debt. But payday loans are a temporary and very short-term solution to a bigger problem and I would strongly advise against using one.
They might have flashy adverts and might seem like a great way to get out of debt, but they have incredibly height interest rates and will usually have tight deadlines for repayment. With a payday loan, you’re solving one problem but making a much bigger one in the process.
They might be tempting and seem like they’re offering you a way to get out of debt but in the vast majority of circumstances, they are simply not worth pursuing.
Plan A Budget
Getting out of debt means you’re going to have to save money and if you want to succeed in doing this (especially over a long period of time) then you should draw up a budget as soon as possible. A budget will help you ensure you save money and cut any non-essential spending.
You can cut costs in a number of ways and it will all depend on your own individual circumstances, if you eat out a lot for your lunch at work then it’s time to start bringing a packed lunch. Do you buy new clothes every week? If so, then you’re going to have to make some tough changes and avoid frivolous spending.
In some cases, this could mean some very drastic lifestyle changes so make sure you are prepared for it. To work out your budget calculate your monthly earnings with your average expenses and then work out what can be saved. Once you’ve got a plan in place the difficult part will be sticking to it, old habits can be hard to break but with a budget, you’ll be on your way to getting out of debt.
Find A Way To Make Some Extra Income
Yes, I know this is something much easier said than done but there are now many ways you can go about making extra income. Thanks to the internet selling goods and services is much easier than you might think and there are a lot of ways you can make some extra money.
If you have a lot of goods that you don’t need or can afford to sell, then you could easily make some extra money on websites like eBay or Gumtree. Things like clothes, video games, electronics, furniture and much more can all make decent money by being sold online.
If you have the skills you might also want to pursue working in a freelance capacity things like copywriting, proofreading, translation, photography, video editing and much more are all marketable skills and there is a number of freelancing platforms available online.
And of course, if you’re able to you can always search for another job, even if it’s only a temporary short-term contract it could easily help you make some extra money. It all really depends on your individual circumstances, but you’d be surprised how easy it can sometimes be to make some extra income.
So, that’s our tips for dealing with debt, remember you don’t have to struggle alone everyone as someone they can turn to. Whether it’s a friend, family member of a professional organisation like Citizens Advice there is someone out there who can help.