Easing Debt

It’s a sad fact that in today’s economic climate many people are struggling financially and getting into debt. Add into the equation periods of increased spending and it’s hardly surprising that the bank balance can take a hit. So what can be done? Well I’ve put together some simple debt help and advice, that will hopefully ease some of the burden, however I’m not a financial guru and this advice is based purely on simple measures that you could do to try to tackle any debt – if you’re really struggling and need financial help and advice then please seek it from the professionals 🙂

Credit Cards

Don’t get me wrong, credit cards can have their advantages and if you’ve pre-budgeted and are ready to clear the full amount when the payment is due then they’ve done the job!
The problem occurs when balances are not able to be cleared and it’s only the minimum payment that is made – this in turn leads to interest being accrued, making those items you bought very expensive, in the long term.

Credit-Cards

How and where could you cut back in your spending to try to clear those cards?

Look at how many you’ve got, how long you have had each one and look at the interest rates that are applicable.

  • Consider clearing the balance on the one with the highest interest rate first.
  • Look at the possibility of switching your current card to one with a 0% interest – there is often a transfer fee, but if it enables you to pay the monthly balance and clear it before the interest starts, then paying a transfer fee could cost you a lot less than the interest you would’ve paid. Which.co.uk  can offer lots of advice and they have handy calculator tools.
  • Try to pay more than the minimum payment.

 

What Other Areas Could You Make Savings On?

Non-Essential Cutbacks
Take a serious look at your incomings and outgoings – how many of us regularly do this? You may be surprised by what you find. It goes without saying that essential bills, such as utilities, mortgages, food, etc all need to be included in your budget. But is there anything you could cut back on?

  • What about that magazine subscription, or any other direct debits that pay for items that could be stopped or reduced? Any savings you make would soon start to add up.
  • How much do you spend on entertainment? Cinema trips can be a costly event – a typical trip to the movies for a family of four could cost you around £30, and that’s just the tickets, what about refreshments? If you don’t want to stop watching movies, then why not consider an online subscription service, there is a wide choice out there and many have reduced rates or special deals for the first few months. BUT remember it should cost you less than a cinema trip, read the T & Cs and make sure you can cancel before the full price kicks in, if not you’ll have added another outgoing!
  • How often do you eat out/order a take-away, once a week, once a month? The average cost of a Chinese or Indian take-away could set you back £30 for four people, that’s £120 a month if you have one weekly. Now that would definitely go some way to helping with those balance payments. So either cut them out or cut back on the amount of times you order. Why not try making the meals instead, it could become a great night in. 🙂

Reducing Your Energy Bills
We all have utility bills to pay for, but is there any way that we can reduce them? Here are some simple techniques that could help:

  • Heating Consumption – Try turning down the thermostat and adding more layers. Reducing the thermostat by 1°C, could save you around 10% in heating costs, which could equate to approx £55 per year, depending on your supplier and tariff. Is your heating on a timer? By resetting it to come on 10 mins later and switch off 10 mins earlier you will reduce your consumption by approximatley 10 hours per month. A saving of 30 energy hours for 3 months!
  • Laundry – Most washing machines have half-load function settings, which is great if you only have a few items to wash, BUT doing 2 half load washes will actually use more energy than 1 full one, so try to wait until you have a full load. Also try to reduce the amount of times you use your tumble dryer.
  • Boiling The Kettle – It is so tempting to fill that kettle to the max, but it actually takes a lot more energy to boil a full kettle, so try to only boil what you need. (NOTE: make sure that the elements inside the kettle are fully covered though!)
  • Lighting – Energy saving light bulbs are a lot more efficient than the old ones and are readily available. They last 10 times longer than the old ones so you don’t need to replace them as often. Use an energy monitor to track your usage.

Well, I hope I’ve been able to give you some help and advice with these ideas and tips – sometimes just doing the little things can make a big difference. 🙂
Once again, if you are concerned about your level of debt please seek professional advice. There are numerous places you can go to such as Citizens Advice, Which?, Money Advice Service and many more.