If you have significant debts that you have defaulted on then you may have large debt charges applied to your accounts. These will quickly make your debt situation worse.
Debt Charge – Stopping or Reducing
If this is happening to you then you need to take action to regain control of the situation. People that you owe money to will often stop adding penalty charges/interest to your account if they can see that you are taking steps to resolve the situation. One of the best ways to do this is to engage the services of a reputable debt management company. In the UK one of the best ones is the Payplan Partnership (I have personal experience of using them). They can control the process of negotiating with your creditors and can set you up in either a debt management plan or an individual voluntary arrangement. If you are in an IVA then adding a debt charge to your account is not allowed.
Tags: Debt Advice, debt charge, Debt Problems
If you have money worries then the worst thing that you can do is ignore them. You need to take action as this will stop the situation getting any worse and will give you back a sense of control.
Money Worries – What Are They?
Are you worried about your level of debt, low income, or being able to invest for the future? The solutions that you adopt will depend a lot on the answer to this question. One of the first things to do is to write down all of your income and expenditure, any debts, and any savings or investments that you may have. This will form the basis of your decision making process.
Money Worries – Debt
If you have a high level of debt and are worried about being able to repay it then you should seek the help of the many debt-related charities to help you resolve the problem (e.g. the Citizens Advice Bureau or the Consumer Credit Counseling Service in the UK).
Money Worries – Income
If you have lost your job or are on low income then check that you are receiving all of the state benefits that you are entitled to – again the Citizens Advice Bureau should be able to help you.
Investing For the Future
If you don’t have enough money to invest in a pension or savings then start off by looking at the budget you have prepared and identify areas where savings could be made, e.g. reducing television subscription deals or shopping at discount retailers. You will be surprised how much your monthly budget can be reduced without significantly changing your lifestyle.
Tags: budgeting, Debt Advice, money worries
Debt can be a positive or a negative part of your life depending on how you manage it. For some parts of life it is very nearly essential, like buying a home.
Debt Can be Positive
Debt can help you make large purchases like homes or cars that would be difficult or impossible to save up for.
Debt can help you through times when your income is reduced, because of losing your job or taking time to study for qualifications.
Debt Can be Negative
Debt can tempt you to spend money on things that you do not really need.
Debt reduces your future income and will eventually make you poorer.
Chronic debt problems can harm your health and damage your relationships.
Conclusion
Like a lot of things in life debt can be a useful thing if used properly. However if you let it get out of hand it can be a destructive force that will affect your life for years.
Tags: benefits of debt, Debt Advice, debt can, Debt Problems
