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Debt causes a lot of problems for many, many families. It causes stress, it causes relationship breakdowns, it causes sleepless nights and it impacts really, really badly on many peoples’ lives. Read on for simple tips on how to pay down debt fast.
Statistics, from research done by The Money Charity, has shown that the average amount owed per household on a credit card in May 2019 was £2653. For many people, at present, they are able to service that debt and are able to afford to make the repayments each month.
However, if the interest rates go up at all, then it can become very, very scary and debt that was manageable may suddenly become unmanageable. For others who are already struggling to make repayment, their debt may already be unmanageable and causing massive stress.
Making only the minimum payments on the average credit card debt of £2653, with an average rate of interest, would take OVER 26 YEARS to pay back.
How to pay down debt fast
What can you actually do? The first thing I would say is DON’T do nothing!
It doesn’t matter how scary it is. It doesn’t matter how it makes you feel. You should take action and you really NEED to do something.
It is surprising how even just taking that first step towards dealing with debt can actually help to remove some of the stress that you may have been feeling and create a feeling of hope.
Downloading my Practical Guide to becoming Debt-free is a great place to start.
2 Gather paperwork
Get all your statements together and work out exactly how much you owe. Find out to the last penny, how much you owe to each lender and also find out how much the interest rates are for each debt. Make a note of this and then add up the total amount owed.
As scary as this may be, this is a really important step in taking control of your debts.
The sooner you know exactly how much you owe, the sooner you can work out how to pay down debt fast.
3 Income and expenses
Make a list of your income and your expenses and work out how much you can afford to pay towards that debt. Take some time to look through all the expenses to see if you can reduce any of them and therefore find some more money to pay towards your debt.
If you feel that you can manage your debt yourself, then I would suggest that you start selling any items that you no longer need. Facebook and eBay are great for selling unwanted items. The cash raised can really help you to reduce your debt more quickly.
5 Get help
If you are struggling to manage your debt on your own, there is fantastic FREE help available in the UK to help people to manage their debt.
Stepchange are a charity offering various debt solutions. They have a fantastic online calculator where you can enter your details and it will generate a personalised debt plan within minutes. They also have telephone helplines and a wealth of advice on their website.
The Citizen’s Advice Bureaux also offer FREE and impartial debt advice and have a fantastic range of advice on their website. Many councils also have Financial Inclusion Teams, who offer face-to-face FREE advice for local residents.
Money Saving Expert also have amazing FREE information and help for people in debt
6 Set up payments
Once you have completed the previous steps, you can then start making regular payments towards your debt. If you can set up payments from your bank account, immediately after pay day, this will ensure that the debt repayments are a priority. By starting to get the debt paid off, you can then begin to look forward and start making plans for the future.
How can I help?
Change your life TODAY by downloading my Practical Guide to Becoming Debt-free. Prepare to be excited about all the possibilities a debt-free life holds.
I hope that you have found this information helpful.
I am Eileen Adamson, Your Money Sorted coach, working online with UK based women. I can help you to develop a better relationship with money and feel calm, relaxed and positive about money. This will allow you to feel confident, in control and able to make good financial decisions. Through creating a good relationship with money you can then live the life that YOU want to lead.