Find out how you can get the most out of your money with a FREE financial health check from The Money
Nobody ever wants to find themselves in debt, however, it's a
fairly common problem that can be caused by a number of factors.
Small debts can be easily managed, but when debts begin to pile up,
the situation can get very serious, very quickly. Many people find
themselves choosing to completely ignore their debt problems rather
than facing them head on. However, the longer debts are left to
pile up, the worse things can get, so it's important to start
dealing with them sooner rather than later.
If you're concerned about mounting debts or would just like some
advice, why not visit The Money Advice Service and take their
financial health check? (www.moneyadviceservice.org.uk) It's quick and
easy - simply answer some questions about yourself and your money,
then let the health checker do the work! The Money Advice Service
was set up by the government to offer free, unbiased advice to help
you make informed choices - throughout your life and whatever your
Dealing with debt problems
There are many types of debt, with the most important being
referred to as "priority debts". A debt is considered a "priority"
if creditors can take severe action against you if it isn't paid.
For example, a mortgage repayment is a priority as you could lose
your home if you are unable to pay. Other priority debts include
taxes, utility bills and court fines.
When dealing with debt problems, it is a good idea to work out
exactly how much you owe, and to whom. Make a list of all of your
debts, placing priority debts at the top of the list and
non-priority debts, such as credit card payments and bank loans, at
the bottom. By giving yourself a clear picture of exactly how much
you owe each month, it will be easier to work out the best way to
start confronting your money issues.
Debt crisis is the technical term used to define a situation
where your monthly outgoings, even when paid at the minimum level,
can't be covered by your current income. So if you are struggling
with basic payments such as mortgage, bills and minimum credit card
repayments, then you may be in a debt-crisis. If your debts are
large but you are still able to make repayments, you aren't in a