Debt is hard to deal and it can be scary to be in debt. But sadly with the world we live in, debt is inevitable. What makes being in debt even worse, is that you are trying to pay the debts as well as keeping on top of your usual monthly household bills too.
It can cause you so much stress knowing you have more outgoings than income every month. But having a budget can help you lower your debt, and make you feel like you can breathe again.
Having a budget will help you to know where your money is going and how much you are spending. You can also look at what you can cut out of your outgoings. If you have 3 different streaming services, then I would get rid of a couple. You really only need one.
In fact, Netflix has lost so many viewers this year because they cannot afford it anymore. Even the smallest amount of money can help you budget more and help to lower your debt. Here are a few tips to help you to lower your debt and be able to live again.
Firstly, Speak To The Debt Company
I know it is difficult to face responsibility and actually own up to the fact that you are in debt. But the people on the other end of the phone will help you. They are not allowed to make any repayments unaffordable for you.
They are normal everyday people who are working to pay their own bills. They will help you find an affordable amount for you to pay. It could be as little as £5 a month. As far as the debt company see it, you are paying the debt and it is not breaking your bank.
It will stop any debt letters from coming through anymore and you won’t need to panic every time someone knocks on the door.
Pay What You Can Afford
Although the debt company will put you at a payment that you can afford, you also need to be realistic. at a minimum payment, you are never going to pay the debt off. So if you can afford to pay more for one month, then do it.
The sooner you pay the debt off, the sooner you get your credit sorted out. You might also be paying interest on the debt. So if you only pay the bare minimum, your interest builds to an amount that soon becomes more than the debt.
Once you have got one debt out of the way, you can move on to another. Or simply enjoy the extra few pounds that you have in your pocket each week.
Stop Spending Money That You Don’t Need To
When you are trying to get yourself out of debt, the worse thing you can do is to keep spending money! This will overextend your finances and you will probably be buying stuff that you don’t really need.
It gets even worse if you are taking things out on credit plans or chucking them on the credit card. STOP! You need to get back in control of your finances.
I know it is hard when you have money burning a hole in your pocket and you would rather have a new lamp or a day out instead of paying bills or trying to lower your debt. But you need to face reality and get your priorities right.
You can always have that day out next month or the month after. You can buy a new lamp in a second-hand shop. You just need to rethink your priorities.
Include Everything In Your Budget
When you know your budget, you need to stick to it. Be honest about what your food shopping is, if you spend £80 a week on takeaways, then add it to the budget. You can then take a look at your takeaway bills and most definetly cut them back.
Instead, you could try shopping on Too Good To Go or cooking a fakeaway at home. If you do not add everything to your budget, you will end up making it difficult in the long run.
Once you have a budget created you’ll know what you need to do to lower your debt. You will know exactly how much you can afford to pay and whether there will be certain times of the year when it is going to be harder to pay the debt off.
It might take a few months or a few years to pay your debt off and stick to a strict budget. But as soon as you start sorting your finances out, you will feel happier in yourself and you will start seeing light at the end of the tunnel. So you might have to go without your luxuries for a while, but the long game is worth it.
If You Are In Debt Now And You Need Help
If you are in debt there are people to help you out. If you need to speak to someone about your money worries or the debt you are in. There is some advice about the National Debtline here, and you can always ask the CAB for help to lower your debt.
If you are struggling to eat because of your debt, then speak to your local food bank, they will provide you with food and give you advice on how to get out of debt. There is help out there.
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