Personal debt is, on the whole, quite an easy thing to get yourself into. However, even with the UK’s combined personal debt at a record of 1.5bn, there are surprisingly simple ways to avoid bad personal debt – if you’re serious about it, of course.
With the recession bringing about many more job losses and pay cuts, people often turn to credit cards and their overdrafts as a ‘short-term’ solution, to which there are many unforeseen long-term implications – all of which can and should be avoided, regardless of your circumstances.
If you’re already into debt, the most important thing is not to make the situation worse. Credit cards, fixed term overdrafts, and even debt consolidation loans are not the way to go – most will involve high interest rates and fees that will only add to your problems later on.
If you are encountering problems with your current repayments, it pays, quite literally to check if they will renegotiate your repayments to a level you can afford. If you’re unsure about what to do, you can always to the Citizens Advice Bureau or the Consumer Credit Counselling Service, who offer free and impartial advice.
If you want to avoid debt altogether, there are a few good habits you can get into, like avoiding impulse purchases, not using your credit cards and only carrying the cash you need with you. When you do spend money, you can save money by comparing prices beforehand.
Doing part time or weekend work is a great way to bring in extra money each month if you have an unforeseen expense, like a large bill to pay. So whether it’s doing weekend or evening work in a bar or shop, you don’t need to resort to your credit card or overdraft – try and make the money instead.
Find out more about debt management.
