Managing Debt
Firstly, there is help out there and it may be easier than you think.
There are free services that can provide information before you even discuss what debts you have.
The Citizens Advice website explains:
Advice on debt
Planning a budget
Advice on how to think about your money and budgeting
Place that could offer advice on your debt.
http://www.invernesscab.org.uk/debt/debt8.html
-This is a self help guide and offers tools to assist you with your debt
http://www.invernesscab.org.uk/debt/debt1.html
http://www.highland.gov.uk/livinghere/consumeradvice/moneyadvice/
-this website offers advice on what they can do and how to contact them.
Debt is manageable and there are a number of websites that offer information along with organisations that will be able to assist you without any cost to you.
Inverness Citizens Advice
103 Academy Street
Inverness
IV1 1LX
Phone number: 01463 237644
Email: enquiries@invernesscab.casonline.org.uk
Web page
Money Advice
The Highland Council
Policy And Development Team
Money Advice
Glenurquhart Road
Inverness
IV3 5YX
Phone number: 0800 090 1004
Email: money.advice@highland.gov.uk
Web page
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/index.htm
This link provides advice on all aspects of debt management.
Culduthel Christian Centre has recently been approved as a centre to deliver debt advice through CAP (Christians against poverty). The service provides advice and guidance on how to manage your debt and is a free service. To make an appointment phone 0800 328 0006, this is a central line. State that you live in Inverness so they can make an appointment for you at the above centre.
In addition to this, CCC will be holding a money advice course for three sessions in order to show you how to manage your money. The next course is due to start in February 2011. To book a place call Gordon MacKay on 01463 222795.
HOW TO MANAGE YOUR DEBT
The following is a guide on how to begin to manage your debt. Make a start on gathering the information for each of these stages as this information is essential, whether you decide to manage your own debt or seek assistance.
1. To begin, find all the information you have about your debts, who you owe money to, and how much you owe. You may have letters or have kept a mental note of these.
2. Make a list of the companies and their details. Then compile a list of the amount you owe. This might be a little scary seeing everything like this but it will be worth it.
3. Next you need to divide these into priority and non priority debts.
Priority debts
Priority debts are debts that could lead to you being disconnected from your utilities, losing you home, or having your possessions repossessed.
Examples are - Rent, Council Tax, Utility bills, taxes, court fines, mortgages, and secured loans.
http://www.invernesscab.org.uk/debt/debt5.html
This link provides extra information.
Non priority Debts
This does not mean that these are any less important but are considered less of a priority than the above.
Examples are- Credit cards, overdrafts, bank loans, catalogues, money owed to friends or family.
http://www.invernesscab.org.uk/debt/debt6.html
This link provides extra information.
4. The next step is to think about the money you have coming in.
This could be your wages, benefits, child tax credit etc.
5. From this you will need to plan out your current living expenses. There is a budget planner on our website that can assist, which you can find here. Once this is complete you will be able to give a realistic figure as to what is left over to allocate to your debts.
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/PlanYourWayOutOfDebt/DG_10023176
This link gives additional advice on how to manage your debt.
If at any of these stages you find it difficult to organise this information, contact the above organisations and they can give you advice and can appoint an advisor to look over your debt and help to produce a debt management plan.
Citizens Advice has a debt management plan you can follow. The plan details how to contact the people you owe money to, the letters you will need to send and the paper work required to back up your decision to how much you can afford to pay. Look at this to understand the next steps involved.
http://www.invernesscab.org.uk/debt/debt1.html
This link will take you straight to the debt management plan.
6. Once you are clear on the amount you have to allocate to your debts, you will then need to work out how much to pay, remembering to prioritise your debts. You might find that you have very little and are not sure if you can pay all of these. Again, seek advice so that you can at least inform companies of your situation, and that you can provide them with information that can back up your decision.
7. You now need to write to each company explaining your financial situation and propose the amount you are able to pay. There are example letters on the Inverness Citizens Advice website.
http://www.invernesscab.org.uk/debt/debt11.html
This link provides an example of a holding letter. There are others, available depending on who you are contacting. Make up a chart of who you are contacting, the amount you can pay, and when you sent these so that you can check that the company responds. If they don't respond within three weeks, phone them to ask about your account.
8. Once you have reached an agreement with all the companies and payments are set up, make sure you stick to your agreement.
This process may take some time but it is worth doing.
Tips
- Manage your money effectively be realistic to what you can pay back so that you don’t incur more debt.
