Getting Into Debt

Sometimes money problems can quickly get on top of you, especially when there is more going out than coming in. At some time in their lives, most people will have spent more money than they have. The danger is when you borrow more than you can repay or when your lifestyle is costing more than your income, month after month.

Debt can be very stressful and worrying, especially if you are getting demanding letters, red reminder bills or have fallen out with friends or family over debts you haven't repaid. Here's some information that can help you manage your money and tackle debt.

Borrowing from friends and family

Everyone has times when things are a little tight - sometimes an additional expense comes along that you couldn't foresee. But when you borrow from people close to you it can put you both in a difficult situation if you can't pay them back. The best advice is to only borrow small sums of money or when you know you have the funds to pay them back. You may also want to consider who you lend money to - will it cost you your friendship?

Are you in debt? If so, what can you do?

• First of all, admit that there is a problem and make a positive decision to get it under control. It can be embarrassing to be in debt and not to be able to afford the things other people can, but admitting you have a problem is the first step to resolving it. There is help available, and it can ease the worry to talk about it
• Get help, confide in someone you can trust, or contact one of the help organisations on the links page. There are people who understand and can help you to get back in control
• Make a list of the money you owe, who you owe it to and list in order of importance. The most important debts should be essentials such as housing (rent, mortgage etc), food, utility bills, council tax, or debts that charge high interest rates such as credit card bills or finance companies
• Work out how much money you have coming in and try to find out if you are entitled to any benefits, tax reductions, Council Tax rebates etc. 
• Work out a budget of what you can afford to pay each week or month to clear your debts, whilst still covering your everyday expenses. It's important to be realistic, or you could end up building up a new debt while repaying the old one.  Use our budget planner.
• Review your spending and question yourself every time you buy something. Is the item you are buying an essential? Do you need another night out? Can you cut down on mobile phone calls? You might have to make cut backs for a while
• If you have store cards or credit cards, destroy them immediately so you can no longer use them. If you don't, you're more likely to use them again.
• Make sure you keep in touch with the people you owe money to. If you don't keep them updated, you might end up being taken to court or being blacklisted. If you do, explain your situation, companies can sometimes put together an easier repayment plan for you, and if it is a utility company they will be less likely to disconnect you
• Remember, you can always speak to Connexions Direct, your local Citizens Advice Bureau or The National Debtline for free advice

Don't be alone. If you feel overwhelmed and worried about your debts, then tell someone you can confide in or contact one of the organisations on our links page. The National Debtline offers free advice and are happy to help - call them for free on 0808 808 4000.