If you are not in control of your finances, or just worried about not having enough money, then the first step is to take stock of everything. Think of it as a financial M.O.T. By tackling things now, you’ll be much better in the long run - both financially and emotionally. The first section explores this further.
1. Usually the first step to getting out of debt is getting in control of your budget. Our managing your money guide will help you to do this. Next get a clearer picture of your debts by listing all your debts on our debt table - it’s time well spent.
2. Getting out of debt involves making cut backs. Our Savvy Saver site offers lots of practical tips on everyday savings that you can make as well as a savings goal tool to help you save for the future.
3. Move existing debts from expensive interest rates to lower rates. You may want to consider transferring store card and high-interest credit cards to lower interest credit cards and loans but watch out for any balance transfer fees with credit cards.
4. Try not to put off talking to people you owe money to including your bank. They will help you, which may seem strange but it’s actually in their interest to. Let them know early on that you are struggling to make your repayments. They may be able to help you manage them better.
5. See where your finances are at by answering a few simple questions at moneymadeclear.
6. Some people like to have some savings even when they’re in debt. Check whether you’re actually better off saving first, or whether it’s better to repay your debts. This is easy - just compare the interest rate you pay with what you make on your savings. Remember you pay tax on the interest you earn on savings. If you are unsure, talk to your Bank about the options.
7. If you feel that you are in a lot of financial difficulty use our Debt Remedy Tool which provides you with an assessment of your circumstances and access to expert advice on the best way out of your debt situation - anonymous and free of charge.
8. Book an appointment at your local branch for a financial health check. Lloyds TSB offers this free financial Health Check to existing customers, to help you identify and resolve your financial needs.
Next: Borrowing sensibly
