How to start tackling your debt

By Mr Bankruptcy

27th November 2018

 

Whether you’re facing increasingly unmanageable personal debt or your business has a serious cash flow problem, the impact of debt can reach far beyond your financial world.

Debt affects your wellbeing, peace of mind, family life and relationships and in the run-up to Christmas, it can make you feel particularly lonely as you watch the rest of the world gearing up for a holiday spending spree.

That’s why it’s so important to come to grips with the problem. I know what it’s like when debts become too much and I know it’s tough to start taking the actions needed to deal with it. That’s why I want to share some tips on how you can start to get to grips with the problem.

It’s not easy to do but there is a lot of support and help waiting for you, both from friends and family and from professional organisations.

Your first five steps on the journey out of debt

  1. Face your problem

If you’re reading this post because you realise it’s relevant to you then well done, you’ve taken the first step already.

At Christmas it’s tempting to hide a debt problem with more spending on a credit card but by acknowledging your debt is now a problem, you’ve taken a crucial step to getting yourself out of trouble and enjoying a better New Year.

Now you’ve acknowledged your problem, you need to get a measure of its extent. Work out exactly how much you owe, how much interest you have to pay and at what rates. Only when you get a true idea of the scale of your problem can you take action to deal with it.

  1. Talk about your problem

It’s difficult to talk to someone else about what feels like an embarrassing personal issue but I believe the people it affects have a right to know and you may find a lot more support than you think from friends and family.

You may also need some expert advice on debt planning or reconstruction from people who have seen your problem many times before.

Organisations that can help you include:

And don’t forget your health and wellbeing. Your GP can help with the mental and medical side effects of debt.

  1. Prioritise your debts

When you have a clear idea about your level of debt break it down into priority and non-priority debts to identify which to clear first, specifically debts that lead to serious consequences such as a fine or repossession of your home.

From a business perspective, priority debts may include VAT, major suppliers, business mortgages. Personal priority debts include mortgage, utility bills or council tax.

  1. Sort out your budget

Now that you’re tackling your debts, you need to find ways of increasing your income and reducing your living costs in order to get out of the red and to start paying off your debts in a sustainable way:

  • Look for cheaper utilities providers, a smaller car, cheaper groceries
  • Switch credit card loans to a card that offers a 0% deal for a period
  • Negotiate new prices with suppliers
  • Check if you’re entitled to any benefits
  • Cut out luxuries or expenses you can live without

I won’t promise that getting out of debt is easy. You will have to make sacrifices but it is worth it, for the sake of your health, relationships and business.

 Make a plan

Once you understand the size of your debts, your priorities and how quickly you can realistically pay them off, make a plan and stick to it. Your plan goes hand in hand with your budget, and in the long term it will help you to maximise your chance of avoiding being in debt again.

Contact James Rosa Associates for a consultation

James Rosa Associates is a firm of debt advisors and debt adjusters with a reputation for excellence and integrity. Our supportive and friendly approach helps individuals and business owners/directors to reach swift and cost-effective resolutions to unmanageable debt and civil or commercial disputes.

Our services include:

  • Insolvency support
  • Negotiated settlements
  • Personal assisted bankruptcy
  • Mediation

We are authorised and regulated by the Financial Conduct Authority (FRN665061) to work with clients to produce bespoke solutions to fit their specific circumstances.

If you want to deal with an unmanageable debt, or bring a dispute to a swift and cost-effective resolution, contact James Rosa Associates, ring 0845 6807217 or email enquiries@jamesrosa.co.uk to explore whether you qualify for a consultation.

Please be advised that all views expressed in these posts are those of the author and not of James Rosa Associates ltd.

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