Debt is an unfortunate aspect of modern living for most people, but it doesn’t have to be that way forever. There are various measures you can take to tackle debt problems and various government schemes are in place to help you do just that. Once you do become debt free, it’s also essential to stay that way so that you can get the most enjoyment out of your life. Below, we cover some helpful methods for getting yourself out of debt – some of which even include your debt being written off – and offer advice on how to stay debt free.
Consider an Individual Voluntary Arrangement (IVA)
This is what many people informally refer to as a debt write off scheme. It is a debt management solution that was introduced by the government for residents in England and Wales, and it does in fact allow people to have debts written off.
IVAs are a kind of legally binding payment plan whereby you come to an agreement with your creditors so that you can pay a single, manageable monthly fee towards all of your debts. A middle-man known as an insolvency practitioner distributes the money among your creditors, with the oldest debts being paid off first.
This debt solution is extremely popular today because it is helpful to such a large number of people. If accepted, you can benefit from interest rates on your debts being frozen for the duration of the agreement – which is around 5 years – and up to 90% of your debt can be written off.
To enquire about an IVA, give us a call now.
Don’t rely on credit cards
The Central Bank – who certainly know a thing or two about money – state as their number 1 tip for avoiding debt: if you can’t afford it without a credit card, don’t buy it.
We certainly agree with this statement, as many people buy things with money they haven’t earned, and that they don’t actually have. Credit cards create the illusion that people can afford things that they can’t actually afford, leading to money troubles.
As a general rule, if you don’t have the cash to buy something, don’t buy it using a credit card.
If you do need to use credit cards…be sure to use them strategically, in such a way that doesn’t result in you paying interest. If you borrow a small amount and pay it off in full before 30 days, you typically won’t pay any interest.
If you only ever pay the minimum amount, you will be in perpetual debt because the interest on credit cards can be quite high.
Be strict with expenses
For many people, there’s an increasingly indistinguishable line between what we want and what we need. You may think you ‘need’ some hair dye, for example, but it wouldn’t kill you to go without, would it?
The point is, learn to think about what you’re buying in terms of needs and wants. Eliminate non-essential purchases until you are back in control of your financial situation.
