Debt is something that we’ll all experience at some point in our lives. When you think about it, it seems crazy but owing loads of money is just a part of life that we accept these days. The problem is getting worse all of the time and the average amount of debt in the UK is £13,000 per household. That’s just the average, there are so many people that are in far more debt than that. If you’re one of them, you know how awful it can be. Constantly having that debt hanging over you can cause you serious emotional problems as well as financial ones. Worrying about money all day every day is no way to live. Trying to get out of debt is very difficult and you’re probably getting to the point where you think that there is nothing else you can do to get out of that hole, but that isn’t true. Try these last resort methods for getting out of debt before you give up hope completely.
Consolidate Your Debts
One single repayment, even if it’s the same amount as the combined debts, is easier to manage. It’s primarily a psychological thing because that one payment is easier to manage and keep track of. It seems like a counterproductive thing to do but it might be worth taking out one larger loan to pay off all of the others and then just have the one repayment to make. Lots of people that are already in debt will struggle to get loans but you can take one out against your house if you’re in that situation. Find a homeowner loans direct lender who can lend you money using the house as collateral. There are also debt consolidation companies out there that will take on all of the debts for you and then charge a single fee, however, you usually end up paying a little more by doing it that way.
Stop Paying Into Savings
Again, this doesn’t sound like a very sensible thing to do but it’s only temporary. Paying into your savings account or pension pot or is obviously important but if you’ve still got debts when you retire, that money you’re paying in is going to go into your debts in the end anyway. If you temporarily stop paying that money into your pension pot and put it into paying off your debts instead. It won’t add any extra money to your budget but you’ll be able to clear those debts pretty quickly.
Declaring bankruptcy is a last resort but sometimes, there is no way around it. If you’ve tried everything in your power to clear those debts and you’re still falling short, you might have to admit defeat. It’s not a decision that you should take lightly because that mark will remain on your credit score for a long time and make it much harder for you to borrow anything in the future.
Being buried in debt is a terrible situation to be in, but it’s never irreversible. There’s always a way out if you’re willing to take it.