MILLIONS of us are seeing our finances pushed to the brink – but debt expert Johnathan Chesterman warns it’s more important than ever to get help quickly.
It’s easy to ignore debt problems – but if you do, you could end up in a worse situation.
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Mr Chesterman works as a debt advice policy manager for charity Stepchange and is part of The Sun’s Squeeze Team.
He has nearly 30 years of experience helping Brits get the help they need for their money troubles.
Brits are being clobbered with eye-watering hikes to energy, food and fuel bills under a cost of living crisis.
It means that hard-up households are struggling to make their cash stretch to get by – let alone putting it towards paying off their debts.
Why you should act now
StepChange and charities like Citizens Advice and National Debtline offer free advice for Brits struggling to clear their debts.
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Mr Chesterman said the charity finds families turning to them for advice have often put off doing so for a while.
“When they do talk to us, there are desperate,” he said.
But if you get the help right now, then you have right support to help you bring down your debts from the get-go.
“If you ignore it, you could end up facing more serious consequences -like having to declare yourself bankrupt and losing your home if things spiral out of control,” Mr Chesterman added.
The key thing to do right now, he said, was to create a budget and plan your finances if the cost of living crunch gets worse.
“The key thing is to budget and plan now so you know what your situation is now, what the impact is going to be if things get worse with bill rises,” he said.
First steps you should take
One of the first things you should do to get to grips with your debt is to understand what you owe.
Then, you should make a budget based on what you can afford to pay back.
To do this Jonathan said to know how much money you get paid into your account per month.
Then, you’ll need to work out how much you are spending on bills.
You should look to pay off your priority debts and bills first.
These are the ones that could leave you without a home, essential services, or where the lender has extra powers to get your repayment.
“The obvious ones are things like your gas, electricity, council tax, rent or mortgage repayments, and food,” Mr Chesterman said.
Once you’ve figured out how much you’re spending on these bills, you’ll know how much money you have left to pay off your debts.
What happens if I can’t afford to pay off my debts?
If you don’t have enough money to cover off your debts, you need to get in touch with your lenders to let them know immediately.
They might agree to lower your monthly repayments and put you on a more affordable debt repayment plan.
If you can’t afford to pay back any more than you are already paying, Mr Chesterman said to ask for help.
A number of charities – including StepChange – offer debt advice for free:
Citizens Advice and National Debtline can help you manage your debt and negotiate with creditors.
“Don’t suffer in silence,” he said.
“Some people might think that they’re a failure asking for help.
“But actually the sooner you seek help – especially if you know you’ve done everything you can – isn’t an admission of failure, it’s taking control of the situation.”
Whether you’re worried about paying your bills, need to clear debts or don’t know what to do with your pension, get in touch by emailing [email protected].
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