How to Manage Debts Better
1. Always Pay On Time
This is the golden rule, if you can stay on top of your debs by paying by the required date, you will save yourself the possibility of an inevitable downward spiral. Get into the habit of paying debts on time by setting up a system to pay.
2. Prioritise
You should always pay off the most important debts first. These include things like mortgage repayments or rent and utility bills. When paying off credit or store cards, pay off the ones with the highest interest first.
3. If Possible, Switch.
By switching credit cards you may find a lower interest rate. Look at different lenders, they may offer competitive rates. Ensure you are aware of any transfer fees.
4. If You Can, Pay Off More
It is tempting with credit, to pay off the minimum payment. If you can afford to, pay off more, it will reduce the period of time to pay off the full amount. Ensure you check that you will not have to pay a penalty payment for this.
5. Impulsive Buyer? Don’t Trust Yourself With A Credit Card
Credit cards can be useful, but if you know you can’t trust yourself and find yourself spending more than your means allows, don’t use them!
6. Always Check Your Statements
Checking your bills is necessary to monitor how much you are spending and how much you are paying back per month.
7. Save, Save, Save
Saving is a vitally important habit that, if possible, you should do. Even if you start small, putting a small amount into a savings account is a worthy thing to do and it can be a safeguard against unexpected financial situations. As a rule, you should try to consolidate debts before saving.
8. Communicate
If you feel your debts are getting out of hand, it is important to discuss the situation with someone. Whether that is a family member, friend or debt councillor, you needn’t struggle with debt alone. There are a number of free advice services available including the Citizen’s Advice Bureau.
9. Consider Other Options
If your debt is severely out of control, consider options such as an IVA. Details of these can be found on our Common Financial Terms page.