It is often difficult to deal with a debt problem. It is easier to ignore your debts. Most debts can be sorted out if you know what to do and creditors prefer to deal with people who are making an effort.

However, you must plan a solution if you are in a complicated debt situation. This section outlines a step-by-step approach to managing your debt problems.

Am I in debt?

There are a number of tell-tale signs that you are in debt. Get advice as soon as possible if you think that you may be in debt. Ignoring the problem will only make it worse. More

Dealing with your debts

Most debts can be sorted out if you know what to do. Plan a solution if you are in a complicated debt situation. This section outlines a step by step approach to managing your debt problems. More

Work out the extent of the problem

Work out your financial situation before agreeing to make extra payments. You may end up making unrealistic offers if you don’t know the full situation. Get in touch with your creditors to let them know you are dealing with your debt problem. More

Maximising income

Maximising your income can allow you to make a realistic repayment offer. You can maximise your income by checking your tax and benefits entitlements. You may also be able to take in lodgers or work overtime. You may want to consider selling your home. More

Reduce your spending

Use the ‘Spending sheet’ to work out how much you are spending every week. This will outline how much money you need to pay your debts. You may be able to see areas where you can reduce your spending without causing your family hardship. Be realistic about the savings you can make. More

Producing a repayment plan

Make repayment offers to your creditors based on how much money you have available after your essential spending. Pay your priority debts first, then your non-priority debts. Your creditors may write off some of your non-priority debts if you are unlikely to be able to pay them. More

Insolvency, Bankruptcy and Debt Relief Orders

There are formal remedies available if your debts have become overwhelming. It's important that you seek out independent, money advice from an advice agency if you're considering one of these options. These remedies could have a serious impact on your ability to get credit in the future. More