Tips to Arrange Your Debt in Order of Urgency

Tips to Arrange Your Debt in Order of Urgency

It is not always possible to manage all the debts according to your plan. Sometimes, it happens for a reason or two that you won't be able to pay them all back in a said time. This is the time where you have to arrange your debts in order of urgency, .i.e. the most urgent debt should be on top and so on. For instance, your order should be something like:

Your rent or mortgage

Secured loans (a secured loan is any borrowing where the lender can repossess an item of value from you if you do not pay back what you owe you should be particularly careful about any loans secured against your home)

Electricity, water and gas

It is better to arrange your debts in order of urgency before getting into a difficult situation. Always keep yourself prepared for the hard times and the best way to cope with your difficult financial times is to prioritize your debts. See what is more important and which can be put on for later times. Some of the other important and urgent debts may include

Income tax

VAT

National Insurance

Council tax

Court fines

Television license

Child maintenance arrears

Ignoring these debts can sometimes cause you a lot of trouble. The concerned authorities can prosecute you and even send you to prison in some cases. So, it is important to know how to tackle your debts and how to prioritize them. This is the only way to keep your payments smooth. Once you come to know about the urgency of the debts, the things will automatically come to normal. But if you fail to arrange your debts in order of their urgency, be ready to face the worst financial scenario that will be hard to cope with.

There are many things that seems important to you in first instance, but as you probe deep down into the matter you will realize which debt is most important to pay on time and which can be delayed for sometime. A thorough homework and planning is required to keep debts under control.

Here you have to remember one thing that arranging the debts in order of urgency don't mean at all to leave out the secondary debts aside. They need to be paid as well though at later time but don't forget the fact that you owe them too. Following are given some of the debts that you can include in your secondary debts list.

Credit cards

Hire purchase agreements for unnecessary items (in other words, luxury items that will not cause you great hardship if they are repossessed)

Loans for items that have already been repossessed

Store cards

Telephones (unless they are essential for example, for a sick or housebound person)

Unsecured loans (loans that have not been secured on your home or another essential item of value)

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