A local expert from Citizen’s Advice provides timely tips
on consumer issues.
Q: ‘I got carried away in December, and now I’m worried about the debt I’ve built up spoiling my family this Christmas.’
A: If your spending ran out of control at Christmas, get advice as soon as you can from Citizens Advice or from another free confidential debt advisory service such as Stepchange or National Debtline.
- Collect information about your debts – make a list of who you owe money to and how much you owe.
- Check if you have to pay a debt – you’ll be responsible for a debt if it’s in your name and it’s something that the law says you have to pay, like council tax or water charges. You’ll also probably have to pay a debt if you’ve signed a contract to say you agree to give money to someone.
- Work out which debts to deal with first. Priority debts are debts that can cause you serious problems – mortgage, rent and council tax arrears, unpaid tax bills, court fines, gas and electricity bills. You need to look at your list, work out which of your debts are priority debts and deal with them first.
- Once you’ve got your priority debts under control, you should look at all your other debts. They’re ‘non-priority debts’ because the problems they cause are less serious. Include credit cards and mobile phone debts.
- Check if you can increase your income. Are you being paid correctly? Are you eligible for any benefits?
- Reduce your regular outgoings. You might be able to save money by:
- getting a discount on your council tax
- getting a water meter fitted
- switching to a cheaper broadband, TV, or phone deal paying for your prescriptions in advance
- Check your options for getting out of debt. You might be able to talk to your creditors and arrange a way to pay them, or make a formal agreement called a ‘debt solution’. You’ll need to decide what is the best solution for your situation – a debt adviser will be able to help you choose. It will depend on things like:
- the type of debts you have
- your total amount of debt
- how much money you can pay towards your debt
- Finally, learn from your mistakes. Start planning how you will do things differently next year.
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