Managing post-Christmas debt

Some people will be dreading the first credit card after Christmas arriving but, instead of worrying or being stressed, it’s a good time to change the way you manage your money in the year ahead.
Work out what you owe by getting a clear picture of your debts. Work out the total amount that you owe on each credit card, store card and/or loan and start with the debt that has the highest rate of interest as this is your greatest liability.

The key words to remember are KNOWLEDGE and CONTROL.

Put simply, KNOWING how much money you have coming in and how much is going out. Once you know the exact numbers you have CONTROL because you can then look at how to change those numbers for the better.

It is important to know the EXACT numbers rather than have a “vague idea” about things.

It doesn’t matter what the numbers show you even if they show you are overspending. Once you see you are overspending you can look at how to cut back.

Record your spending for a month, particularly the cash you spend. How often do we take £20 out of the cashpoint and need to do it again the next day with no idea where that £20 went?

Write everything down on paper. It’s much easier to see and therefore easier to see where you’re spending too much money.

Put EVERYTHING down; don’t ignore it because it was a “one off” rather than regular expense. It’s the “one offs” that cause the problems and there will always be other “one offs” in subsequent months too.

It may be worth reviewing your utility providers in order to economise and bring down household bills and a visit to a price comparison site may well prove fruitful .

Changing your bank may result in lower charges or higher rates of interest.

It might also be worth investigating whether or not you can move your mortgage, as the loan on your property is the biggest debt you are likely to have.

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