Today marks the start of Debt Awareness Week 2014, and with many people still feeling the pinch after excessive festive spending it could be a great time to take a look at things.
It can be all-too easy to get trapped in a cycle of debt, a cycle that can be incredibly difficult to get out of, and unfortunately some people leave it far too long to take action. Figures from StepChange, the debt charity behind Debt Awareness Week, reveal that 41% of people in debt wait a year or more to get help – in that time the problem could easily be made far worse, so the key is to get help as soon as you feel the pressure of credit commitments getting a bit too much.
There are plenty of signs that would indicate your level of debt has gone too far. Things like being too scared to open bills, being unable to sleep through worry or even constantly hitting your credit limits could all indicate financial difficulties, and if you find yourself flashing the plastic only to be declined at the till it could be time to take stock.
In fact, 84% of respondents admitted to regularly going up to or over their credit limit – being too reliant on credit can often be the first indication of a debt problem, so if you've spotted the signs (or have noticed the signs in someone you love) it's important to face the facts and start planning your route out of debt.
Luckily, there are things that can be done to ease the burden. The first thing to remember is that sticking your head in the sand should never be an option – facing up to debt problems can ensure things don't spiral out of control even more, and if you're really struggling you should always call your lender to discuss your situation and see how repayments can be made.
The next step – stop using credit! It's easy to fall back on those trusty cards but that won't solve the problem, so try to stop swiping the plastic at the checkout and live within your means, even if it means foregoing the odd luxury. Then you can think about the likes of balance transfer credit cards.
Excessive interest payments can make debt harder to pay off, so switching to a balance transfer card with a 0% deal can mean you've got time to pay it off before interest adds up. Consolidating all existing debts in a personal loan can be another good option to give a clear route out of debt after a set period of time – if you don't use any more credit thereafter, you could be debt-free before you know it!
Compare balance transfer credit cards
Compare loan repayments and interest with our easy-to-use loan calculator
Check out our guide to staying debt free in 2014
Dealing with Debt
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
Moneyfacts.co.uk will, like most other websites, place cookies onto your computer’s
hard drive. This includes tracking cookies.