Debt management: 3 fundamental steps to help you take control of your personal finances | Personal Finance | Finance

As part of 2022’s Debt Awareness Week, experts are trying to improve people’s knowledge of how they can manage debt they accumulate. Around 30 percent of Brits struggle to keep up with their bills and can be left feeling overwhelmed by the pressure that accompanies mounting arrears.

Managing your debt can essentially be split into two sections. The first of which is to do with ‘understanding your finances’.

Tackling arrears is a task that is only made harder if you don’t have a clear idea of what is happening with your money.

Sitting down to assess your income and outgoings can be time-consuming, but it will save a lot of future work and uncertainty.

Paul Stringer, Director at Norton Finance, explained to Express.co.uk how debt can quickly add up if people aren’t educated properly on how to deal with it.

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3) Make the minimum payment

In the scenario where paying off your debt is proving to be a struggle, try your best to make the minimum payments.

Not only will this avoid late fees, but it will also prevent you from incurring any knock-on effects on your credit score.

Conversely, if reaching the minimum payment is difficult, talk to the creditor directly to ask for an extension, rather than taking out a credit card and putting yourself in further debt in order to make the payment.

Mr Stringer added that one possible solution for people with multiple loans to pay off is debt consolidation.

Going down this route would pay off your existing loans and combine your debt into one source with monthly repayments, as you would only owe money to the debt consolidation provider.

In fact, having one provider can make dealing with your debt easier as there are fewer payments to keep track of and you could save money on interest and late fees.

Nonetheless, debt consolidation isn’t necessarily the answer for everyone, so it’s important to make sure you understand your financial situation and speak to a loan provider to assess your options.