How To Avoid A Severe Debt Problem

Personal debt is something that is, generally

, quite easy to get into. National statistics show that, in combined personal debt, the UK is almost 1.5bn in the red.

With the recession bringing about many more job losses and pay cuts, people often turn to credit cards and their overdrafts as a 'short-term' solution, to which there are many unforeseen long-term implications - all of which can and should be avoided, regardless of your circumstances.

Budget. Though it may sound daunting at first, budgeting can make the difference between not making your utility payments and a good night's sleep. Make sure all your outgoings are accounted for (before payday) - and pay everything on time - the coming month will be much more bearable.

Credit cards, fixed term overdrafts, and even debt consolidation loans are too often seen as a quick fix, but the truth is that these options will involve high interest rates that will worsen your position sooner or later - so remember that budgeting will be key to staying debt-free.

Limit outgoings - spend only what you need to. Avoid impulse purchases, spending on credit cards and declining any 'buy now pay later' offers from retailers. Also, when you do spend money, make sure you compare the available prices to get the best deal possible before you buy. Buying grocery essentials from budget stores can also reduce your regular outgoings considerably.

Supplementing your income with part time or weekend work, even on a short-term basis, can help you with unforeseen costs, or to help with a bill you can't seem to shake off. Doing this also means you won't need to turn to your credit card or overdraft in your hour of need.

by: Deb Teller

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