Over 9 million people in the UK are in debt

Find out how to pull yourself out of debt with my guide…

It’s no secret I was made redundant back in 2013… That is when I fell into debt, badly.

There are millions of people around the world in debt and it can feel like you’re drowning at times. Although it may feel as though there is no way out at the moment, just making small changes to your lifestyle will help your finances massively.

I managed to to do it and I would love to show you a few tips on how to pull yourself out of debt.

• The first thing to do is acknowledge you have a problem. If you are anything like me, I stopped opening my post as I was worried how much I owed on my latest gas bill or how many payments I had missed on my water bill. 
• Make a list of every penny you have coming in. Include wages, tax credits, child benefit etc and make a note of this. 
• Now write a list of everything you have going out. It doesn’t matter how small it is or how insignificant you think the spend is, write it down.  It may help if you have a few past bank statements to hand for this.
• Now go through the list again and put a line through everything you know you don’t need to spend money on. Maybe you are spending £2 a day on a sandwich for your lunch at work or maybe you have a Netflix subscription? Even though it feels as though you are getting rid of every luxury you have right now it will be worth it once you are debt free.
• Now, everything you have left should be general household bills and maybe a bill for TV packages through Sky etc. If you don’t want to get rid of your TV package, keep it but call your TV provider and tell them your circumstances and how you think you may have to cancel. They will massively reduce your bills for you while you are in this situation. They halved my bill when I did this and I was still able to keep my TV package, phone line and broadband. 
• Next, it may be worth changing your energy supplier. You may be on the wrong tariff for you or you could be paying too much. Since I started my own Power Switch, I have heard from lots of people and they have been telling me how much they have saved… One woman has saved a whopping £500 a year! My prices can work out cheaper than using a comparison site too, as I go direct to the companies to get the best price. Take a look here…
• Then look at your mobile phone. Are you on pay as you go or contract? If you are on a contract, is it worth your while cancelling the contract and switching to pay as you go? Or if your contract is up for renewal, it is worth a try calling all of the network providers and playing them off against each other and seeing who can give you the best deal for the lowest price? I also have a mobile phone comparison tool to make sure you’re getting the best deal.
• What about your home? Although it seems a bit drastic, could you downsize? I did and it saved me £100 a month! I lived in a 4 bedroom maisonette at the time. I had no front garden and a tiny shared back yard so I didn’t like where I was anyway. So I found a 3 bedroom semi in a nicer area which had front and back gardens and it had a much better price tag! So downsizing isn’t always bad.
• When you have worked out how much you have coming in and going out, you need to prioritise the bills.

You MUST pay your priority debts, which are – 

• Rent/mortgage
• Council tax
• Gas and electricity bills
• TV licence 
• Child maintenance
• Court fines
• Hire purchase agreements (If what you are buying is essential) 

Do give them all a call though and let them know you are suffering financial difficulty. The council tax department may be able to spread your payments over a longer period of time to help you out. 

Non priority debts still need to be paid but aren’t as important and they have to be flexible with you while you are experiencing financial difficulty. Non priority debts include…

• Credit card, store card debts
• Catalogue, home credit or in-store credit debts
• Bank or building society loans
• Personal loans
• Pay day loans
• Overdrafts
• Money borrowed from friends or family

Once you have worked out how much money you have coming in each month, work out how much you have going out on priority debts and all other essentials such as grocery shopping, travel expenses to and from work, clothing for you/children. Always be realistic and don’t state that you need £100 a month for clothes!

Once you have worked that out, split the remaining money you have left between all of your non priority debts and give them a call and explain the circumstances. Make them an offer and they should accept it. 

It is very stressful dealing with debt but you don’t have to do it alone. By best advice would be to visit the Citizens Advice Bureau as they know debt advice inside out and can take over it all to relieve you of the stress. They will help you work out your incomings and outgoings, they will even contact the companies and make them an offer on your behalf.

I know someone who is currently working with Citizens Advice on her debt right now and she said ‘I’m so pleased i contacted CAB for help and advice for my debt. I buried my head in the sand for so long until bailiffs turned up on my door step, that’s when I realised just how bad my problem had got. I work but I was hit by the bedroom tax, then my partner had an accident and is on long term sick and only getting government sick pay, so we can no longer meet all of our bills. CAB were great though. They took over everything and contacted all the companies I am in debt with and I’m now paying back £3 a month to each company until we get back on our feet. If it hadn’t of been for CAB I dread to think what kind of situation we would be in now.’

For information on bailiffs, see here…

I hope this helps you pull yourself out of debt, or at least start to. 

Let me know how you get on, good luck.

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