With the country still in a recession and inflation stealing much-needed money from people’s wallets, it is hardly surprising that debt continues to be a major issue for many Brits.
According to the latest statistics, households across the country pay out a whopping £172 million in interest payments alone every day. One person will become either insolvent or bankrupt every five minutes and 1,694 people are made redundant every day.
These eye-watering figures show the true extent that the austerity measures and recession is having on the average man on the street and many people simply do not have the resources to be able to cope with such a heavy financial burden.
If this sounds like you, take comfort in the fact that you are not alone. However, there are ways to try and cope with your finances. Below are some ideas which could help you manage through the more difficult periods.
1) Work out your income and expenditure
You may think you know every last detail of your income and expenditure but taking the time to sit down and sift through a bank statement may produce some surprises. Many people find they are still paying for goods or services they no longer use and make savings just by cancelling direct debits which they did not realise were still in force.
2) Find out if you qualify for additional benefits
Have you considered whether you are eligible for any benefits? You do not necessarily need to be out of work, disabled or a pensioner in order to qualify for financial assistance. A huge chunk of money goes unclaimed every year, because people are unaware they could get some help.
3) Make sure you’re getting the best deal
Do you shop around for the best deal or, like most people, do you simply stick with the most convenient option? The vast majority of Brits don’t bother to scour the market for the best deal, instead sticking with the same insurer or utilities provider, simply out of habit. Swapping companies could save you a serious amount of money.
4) Shop around to cut spending
And it isn’t just your car insurance and electricity which you need to re-think. Where do you buy your food and why? A lot of people stick with the same supermarket they were brought up with, even if it is more expensive. Switching to a different supermarket, depending on where the best deals are is a good habit to get into and can slash the cost of the contents of your shopping trolley.
5) Make cash from your unwanted goods
If you need extra cash and you don’t have the option for either overtime or to get a second job, think about different ways to drum up some money. Most houses have plenty of things cluttering up cupboards which have never even been opened; doing a car boot sale or selling on eBay can help to relieve the financial pressure.
6) Understand what your priority bills are
If you can’t afford to pay all your bills, prioritise your debts so you pay the essentials first – accommodation, utility bills, council tax and food. Your credit card company might not be happy but it’s more important that you have a home, are warm and have food. Council tax is an essential expense because if you fail to pay your bill, you could face legal action and even a prison sentence.
7) Avoid taking out additional credit
And finally, whatever you do, don’t borrow more money to simply survive. If your debts are that severe, seek professional help from a company such as Baines and Ernst.
Baines and Ernst have been helping people get out of debt since 1996 and – as members of DEMSA – subscribe to a professional code of conduct which has been approved by the Office of Fair Trading. They have a team of experts at the end of the telephone who are able to talk through the various options available, such as Debt Management Plans, Debt Relief Orders and Individual Voluntary Arrangements.
Nearly everyone experiences financial difficulties at some point in their life and an increasing number are turning to debt management companies, such as Baines and Ernst, to help them get back on track and free of their financial woes, once and for all.