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Contact the people you owe as soon as possible. Most will try to help you. They may agree to reduce or pause: Mortgage payments Rent payments Energy bills Loan repayments Car finance payments They may also: Let you access savings early Offer you more credit Look at your energy arrears
Late benefits? Job loss? Soaring living costs? Help is available. Read more about emergency help here.
This can be hard, but you need to know: How many debts you have How much you owe for each one How much interest is added Once you do this, you can start to plan. Open your letters Look for your latest bank statements and letters from people you owe You can also view statements online. Write down: How much you owe each of your creditors How much you pay them each month Look for: Mortgage or rent payments Credit or store cards Catalogue accounts Personal loans I cannot find these details. What should I do? Check your credit file. This can show you what you owe online. There are three main credit reference agencies: Experian TransUnion Equifax Check with all of them so you do not miss anything Deal with urgent paperwork You need to know which bills are priorities. The impact of not paying priorities is bigger. Work out which bills to pay first.
A monthly budget shows your: Income Debts Bills Other spending It helps you understand your money and take back control. This is how to do it: 1. List all the money you have coming in during the month Include: Wages Benefits Pension Any other regular payments Add these together. What is the total? Tip: To turn a weekly amount into a monthly amount: Multiply the weekly amount by 52 (the weeks in a year) Divide that total by 12 (the number of months in a year) The result is the monthly amount 2. List your monthly spending Write down all your regular, monthly bills. Make sure you include: Rent/Mortgage Gas/Electricity Water Council tax TV License Mobile Phone Broadband/TV package Childcare costs Clubs and memberships Hire purchase costs Insurances Write down all the other things you buy that change from month to month: Food Clothes Travel Hobbies Activities Entertainment Subscriptions Think about one off spending like Christmas or a holiday. Divide those costs by 12 to get a monthly figure and write them down too. Add everything you have written down together 3. Write down all the minimum monthly payments to your debts Add these together 4. These lists together are your monthly budget How much do you have coming in versus going out? Have you got everything you need covered? Can you make savings anywhere? Find more about how to make a budget here.
It is always ok to ask for help. There are many organisations that help people deal with debt. StepChange Debt Charity offers free online advice 24/7. We provide practical debt solutions when appropriate. You will get a reference number to show your creditors you are seeking help. Complete your session on your own terms. Our online service saves as you go. Get debt advice now
When you build a budget, you list out all your spending. This can help you spot areas to save a little each month. If you are already cutting back, there may be other changes that help over time. Food and housekeeping tips Plan meals in advance Make a shopping list Do a weekly food shop with your list Cook in batches and freeze meals Use multi-purpose cleaning products Tear old clothes into cleaning rags instead of buying sponges and wipes Personal care Finish toiletries before buying more Bars of soap last longer than shower gel Use pea-sized amount of toothpaste Use a 50p-sized amount of shampoo (for long hair, less for short hair) Utilities Compare and switch Can you get gas and electricity cheaper from someone else? Switch off Turn things off when not using them. Particularly at night Cold wash, line dry Wait until you have a larger load to run the washing machine. Avoid tumble drying. Our energy customer guide can help you deal with rising energy bills. Communications Compare and switch There may be a better deal for your phone or internet contract. Connect to Wifi - This saves money on phone data. Use webchat apps - Calling people with apps uses your broadband or data package Especially helpful for long distance calls.