How To Get Out Of Debt

We’re living in challenging times right now – and for many of us, the stress that brings, is compounded by feeling anxious about money.

STEP-CHANGE the debt charity, did some research and the figures for us here in Wales are frightening. We can only imagine how much worse the situation is 12 months on.

Based on general public polling, they estimate that around 8% of adults living in Wales are facing severe debt problems, compared to around 6% of the UK adult population.

This equates to 193,000 people in Wales in severe problem debt. They estimate a further 412,000 (16% of the Welsh population) are showing signs of financial distress.

When they looked at those who have dependent children, over half are single parents (54%) whilst 46% are in couples.

In the wider Welsh population just 27% of adults with dependent children are single parents, compared to 63% who are in couples.

Almost everyone has some sort of debt, whether it’s the mortgage, credit cards, an overdraft or loans. And whether it’s hundreds or thousands of pounds, finding yourself in debt is both frightening and overwhelming. Getting into debt is always easier than getting out. Credit card companies and retailers encourage shoppers to take out cards with attractive sign-up benefits, and banks continually offer their customers loans – all involving repayment at a healthy annual percentage rate. Lenders have made it far too easy to get into trouble. Depending on how deep in debt you are, you may feel like there is no light at the end of the tunnel, but rest assured there is.

So here is the SOUTH WALES LIFE plan to help tackle debt, head-on.

DON’T IGNORE DEBTS

People find themselves in financial difficulty for any number of reasons, such as unemployment, illness, marital breakdown, or other unforeseen circumstances. Although you cannot do anything about these or past mistakes, there are things you can do to improve your current situation. Many people ignore debts when they experience financial difficulty. Some fear contacting creditors. They do not understand the consequences of not paying bills. Ignoring debts will affect your credit rating. In addition, creditors may take action against you in an effort to get payment. Or your bill can be turned over to a debt collector, your property can be repossessed, or you may be forced into bankruptcy. If trying to get out of debt seems like trying to run a race while being tied to the starting line, and no matter how much energy you put into it you never seem to get anywhere, it’s time to get some serious help. The key to solving the financial difficulty is communication.

HERE IS HELP

The National Debtline estimates that more than 8 million people in the UK have financial difficulties, and has come up with a plan called ‘How to deal with debt’ to help you take your first steps towards a fresh start with your finances, which can be downloaded from www.nationaldebtline.org Here’s a summary of their 3 key pointers:

Know what you’ve really got. • Get all your information together on your income and outgoings – bank statements, wage slips, benefit/pension statements, bills, letters from creditors. • Work out your monthly outgoings • Work out your debts and categorise them by priority • Use this information to complete the budget template available on the National Debtline website.
Maximise Your Money • Check out the advice on www.moneysavingexpert.com – you may be able to save hundreds or thousands of pounds by following their tips. • Plan your grocery shopping carefully – make a list, use vouchers where you can, and buy own brands wherever possible. • Check your utilities, water, phone, and broadband tariffs to make sure you are on the best deals. You may also be eligible for certain grants depending on your circumstances.
Choose your debt solution • Deal with your priority debts first – for example, debts that could mean losing your home or having the gas or electricity cut off. • Get in touch with your creditors straight away and explain your difficulties. • Contact everyone you owe money to. If you make arrangements to pay some creditors but not others, you could run into difficulties again. • Always respond to any correspondence regarding County Court action. Don’t think that going to the County Court makes you a criminal; it isn’t that type of court. You won’t go to prison and there’s no jury. Keep copies of any letters or court forms you send or receive.

FREE ADVICE

For detailed and comprehensive guidance on dealing with your debts, go HERE and download their ‘How to deal with debt’ guide. National Debtline is a charity who give free, confidential, and independent advice over the phone and online. Call them on 0808 808 4000 or visit their website for details of how to set up a webchat with an advisor.

DON’T IGNORE DEBTS

HERE IS HELP

FREE ADVICE

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