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Personal debt can feel like a lonely journey that is made longer by the hefty financial burdens you carry. Though the ‘good debts’ – your mortgage or education loan, for example – can actually help you on your way while they are affordable, the ‘bad debts’ weigh you down more and more, until you are in danger of grinding to a halt. Personal debt is not a never-ending road, though. It is possible to break the debt cycle, lift yourself out of debt and put yourself back into healthier finances. However, in order to do that, it is essential to stay on track – both in debt, and once you are free of ‘bad debt.’ 
 
In debt 
 
When you are in debt, and have resolved to get yourself out of debt, staying on track is the only way to get the job done. When you stay on track, you are making progress. Wandering from the track only makes the journey to a debt-free place longer. 
 
Make a plan 
 
You wouldn’t set out on a journey without planning a route and finding your way out of personal debt is the same. You need to plan your route to a debt-free life. First, you need to decide what that place is. It may be as relatively simple as a place without credit card debt, or it could be a place without ‘bad debt,’ that also has a growing savings balance. Now, how are you going to get there? Decide on effective steps and take them. These steps could include debt consolidation measures, or the negotiation of an Individual Voluntary Arrangement through a licensed Insolvency Practitioner, such as Smith & Barnes. Lay the plan out as small, achievable steps to reduce the sense of being overwhelmed. Most importantly, stick to the plan. 
 
Set rewards, and enjoy them 
 
Just because you’re in debt, doesn’t mean you don’t deserve a reward for achieving a goal – however small that goal may be. Be kind to yourself. As you make your plan, be sure to include incremental, affordable rewards to keep you incentivised. Then, make sure you take the time to enjoy those rewards. After all, you earned them. 
 
Keep a debt journal 
 
A journal can be a great motivational tool. It provides a lens through which you can monitor your own progress, and watch change happen over time. In a personal debt situation, it can also be a powerful tool for identifying causes and problematic patterns. When you are trapped in a stressful debt situation, it can be difficult to look at the issue objectively, to make a well-defined and rational plan. Keeping a journal can create the little bit of space needed between you and the situation to let you see things a little clearer. Once you are out of debt, the debt journal becomes a brilliant information source – a complete picture of the situations you now want to avoid. 
 
Appoint an accountability buddy 
 
Accountability can be crucial to your personal debt journey but, when the only person you are accountable to is yourself and some faceless, anonymous creditors, it can be easy to let things slip and wander off track. Excuses can be easily made when it’s just ourselves we’re talking to, but if we’re also held accountable by a reliable and trusted friend, it can make all the difference. That person can give you a little reminder of the importance of staying on track. In those moments when you feel like you’re never going to reach your goal, they can remind you of all the progress you’ve already made and can help you re-motivate yourself. They can also help you celebrate when you finally reach your debt-free place. 
 
Out of debt 
 
Once you have achieved your goal of being free from ‘bad debt,’ you might think that you can forget about the all-important plan. While it’s important to take a little time to acknowledge and celebrate what you’ve achieved, you do still need to stay on track. You’ve worked hard to get yourself out of a stressful personal debt challenge – you don’t want to waste all that hard work and allow yourself to get lost in debt again. It’s time to make a new plan. This plan will be a longer-term, ongoing plan that makes sure you stay out of problematic levels of ‘bad debt,’ while also building savings. This is a necessary plan – not just to prevent a loss of progress, but also to make sure you have a protective cushion of funds in the future, if circumstances beyond your control cause disruption to your income. 
 
Budget 
 
Now that you have freed yourself of ‘bad debt,’ it’s time to create an updated budget. Examine your monthly income and outgoings and draw up a clear and simple budget based on current figures. Account for essential bills first, then non-essentials. Try to aim for saving 20% of your monthly income. 
 
Overhaul regular monthly bills 
 
Having examined your monthly outgoings, investigate whether any of those bills can be reduced by shopping around for different suppliers. 
 
Use comparison websites to find more competitive deals on insurances. 
Outstanding credit card balances could be reduced more quickly by switching to a card with a lower interest rate. 
Re-mortgage your property at a more competitive rate if your fixed term mortgage agreement is due to end. 
Check any current work benefits that accompany your employment – you may be able to reduce your monthly costs if your employer subsidises or provides for childcare, for example, or transportation. 
 
Use tricks to reduce spending 
 
Reductions in spending can be achieved with some simple tricks. For example: 
 
Buy own brand products at the supermarket. 
Save your shopping baskets for 24 hours when shopping online. This will sometimes prompt the retailer to either draw your attention to a cheaper option, or to a money-saving offer. 
Delay the purchase of non-essential items for 30 days. Think of it as a ‘cooling off’ period. If there is something you would like to buy, put the idea aside for 30 days and, if you still wish to make the purchase, go ahead. You will find, however, that you will often have changed your mind and the money you would have spent on an impulse buy is now in your savings. 
 
Ask the experts 
 
With something as important as staying on track – both in and out of debt – it is essential to seek expert advice. Smith & Barnes Insolvency Practitioners are highly qualified and licensed professionals who can help you create a plan to which you can stick. Call today to find out about this low cost, bespoke service. 
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