Whilst getting into debt is unavoidable for most of us it is possible for those that are struggling with their debts to take action to try and ease the situation. The measures and options that are available to you will depend on a number of things, such as your personal situation and circumstances to the level and type of debt that you have. It is a good idea to look at the various options that are open to you, as some resolutions will work more effectively than others.

Over the past couple of years in particular many people may have found themselves deeper and deeper in debt, with financial problems having affected their finances to the point where they have been living on credit. Being in debt so deeply can really drag you down, and this is why it is so vital to take action as early as possible in order to get things sorted out with your finances and ease the stress that debt can cause. Some of the many solutions available are outlined below:

Consolidation: Consolidating your debts can prove to be one effective option for those that want to try and reduce their monthly repayments and make their debts more manageable.

This is an effective solution for those that have a range of different unsecured debts such as credit cards, loans, overdrafts, etc. In order to get a good rate on a consolidation loan you will need to have a pretty good credit rating, but if you are able to get this type of loan you can wrap up all of your other debts into one, cut the number of creditors that you are dealing with, and reduce the amount that you are paying out each month.

Debt management plans: If you are in a situation where your debt repayments are taking up a large chunk of your income, leaving you short of money for other essential payments, it is worth considering a debt management plan. There are various debt charities and agencies that can help to set these up, and you should find one that does not charge a fee.

Under a debt management plan you could reduce the amount that you are paying to each creditor by a significant amount and simply pay over a longer term until it is paid off. The interest on your debts is often frozen under these plans, and you usually make one payment to the debt management company which will then distribute the payments to your creditors.

IVA: If you are really struggling with your debts, you have over £15,000 in unsecured debts, you or your partner is working, and you meet the necessary criteria you may be eligible for an IVA.

This is known as a softer alternative to bankruptcy, and is not something that should be taken lightly to escape debt. However, for some people that have no other option it can be an effective solution, and in most cases you will pay a reduced monthly payment to be distributed amongst your creditors for five years, after which time the remainder of your debt will be written off.

Get your debts under control this year is a post from: Nicon Debt Management

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However, whilst taking part in exercise is a good thing for some people it can also cost a small fortune, and it is therefore necessary for many people to think of ways of exercising without paying out a fortune.

Of course, one of the simplest and cheapest ways to keep fit is simply by going for a brisk walk or a jog on a regular basis, but the trouble with this is that the weather in the UK is not ideal for joggers and you are more likely to end up with a bad cold and chilblains than being fighting fit.

Another concern is that many people work full time, and the last thing that most people want to do when they get home is head out onto the roads to jog, as this can be unsafe apart from anything else.

Joining a gym is another option, and this is a more secure option and one that enables you to exercise indoors. However, gym memberships can be very expensive, and in many cases you need to sign up to a minimum twelve month contract in order to get the most affordable prices which means that you will have to make payments for the contract period whether you continue to go or not.

There are some tips that could help you to save money on keeping fit without having to put up with the bad weather or put your safety at risk. For example, if you want to join a gym see if you can get away with an off peak membership, which is often far cheaper than the peak one. With these memberships you are limited to when you can use the facilities, but if the hours fit in with your lifestyle then this is a good way to save money.

You could look at getting an exercise machine for the home, so that you can exercise in safety at a time that suits you and from the comfort of your own home. There is no need to buy a brand new exercise machine, as these can be very costly. Instead scour the papers or go online to places such as eBay where you may be able to find the perfect exercise equipment at a knock down price.

Many people use DVDs to work out to, with a wide range of exercise videos and DVDs that are now available. You can check out the prices of these online to get the best price, and if you don’t want to buy the DVD you could even check out the local library and hire out exercise DVDs so that you can start getting fit without having to pay anything.

Keeping your body and your finances fit is a post from: Nicon Debt Management

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During the recession many people did their best to cut back on the amount that they were spending, and rather than accruing debt they decided to make payments to try and clear existing debts to ease their financial situations. However, inevitably there were many people who were unable to do this as a result of their finances, and in order to cope with essential payments such as their mortgage repayments, rent payments, and day to day essentials had to turn to their credit cards.

On top of this the recent Christmas period has also affected the level of credit card debt, and following another turbulent financial year many people did not have enough money put aside to pay for their Christmas purchases and once again had to turn to their credit cards. With credit card bills having now been sent out after the Christmas period a large number of cardholders will found that they cannot cope with repayments on their cards.

As a result of all of these factors industry experts are now expecting the number of credit card consolidations in the UK to increase, as consumers rush to take action to make their credit card bills more affordable and relieve the financial strain. The soaring number of personal insolvencies in the UK has already given an insight into the problems that consumers are facing with their debts, and for many consolidation may now be necessary to cope with their finances.

There are a number of options available to those that are looking to consolidate their credit card debts, and in some cases this can be a really sensible solution as it can mean reducing interest and cutting repayments, which can subsequently mean reducing the risk of missed and late payments, CCJs, and black marks on your credit report. A consolidation loan is one of the solutions that consumers can go for, and these loans can be used to wrap up credit card debt as well as other smaller, high interest loans, catalogues, store cards, etc.

Another option is to go for an interest free balance transfer credit card, and with these borrowers can transfer debts from multiple existing cards up to the new credit limit, and can then enjoy a generous period of interest free credit to clear the transferred debt. For those that think they may need longer to clear their transferred debt a life of balance transfer is another option, and whilst these do charge a low rate of interest on the transferred balance the interest rate is far lower than the standard and it means that the low rate will be applied for the life of the transferred balance providing more time for the balance to be cleared.

What are the options for consolidating credit card debt? is a post from: Nicon Debt Management

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The jobless rate in the country has risen by over 200,000 in the past three months alone, bring the total of unemployed to 2.47 million – the highest it has been in over 14 years. The unemployment rate stands at 7.9% today – up from 5.6% one year ago.

The recession has exacted a toll on the people and the economy of Britain. According to the figures released by the Office for National Statistics, only a few groups are experiencing any success in obtaining work, such as those in the public sector and foreign-born workers.

David Blanchflower, a former labour market specialist and official with the Bank of England, says that the numbers of those graduating from colleges and universities is the largest they have been for some time.

Thus the young people are coming out of school and unable to find jobs, which makes the recession that much worse for this age group. He fears that the graduates will have permanent scars because of the lack of job opportunities that are open to them.

Blanchflower went on to say, “Firms have stopped hiring at a time when there are lots of young people around. This is a national disaster. The Government needs to do everything it can to get them off the unemployment registers. I believe there is going to be another huge jump.”

His analysis of the job market for the young people of Britain was confirmed by the reports from the Organisation for Economic Cooperation and Development (OECD), which warns that joblessness will continue to rise for some time to come. There were 2.7 jobs lost between December of 2007 and July of 2009 and predicts that ten million more people will lose their jobs by the end of 2010.

OECD-wide unemployment is the highest it has been since it started keeping records at 8.35%. It predicts that this percentage will likely reach 10%.

Stefano Scarpetta of the organisation said, “We are facing a jobs crisis. This is the most rapid increase in unemployment we have seen since the early 1970s. There has been a huge increase in youth unemployment. We need to prevent a lost generation of young individuals who are not being given a chance.”

Almost 20% of young people in Britain are unable to find a job. A further 34.6% are classified as inactive, which means they are on sick leave or have become despondent with the job market and have stopped searching for work. The number of people claiming jobless benefits rose by 24,400 in August to a total of 1.61 million, the highest it has been since May of 1997.

The hardest hit areas of the economy are the financial services, construction and manufacturing and many employees are settling for minimal increases or freezes in pay. Average earnings have only increased by 2.2% in May, June and July of this year – the lowest rates since 2001.

More and More Young Britons are On the Dole is a post from: Nicon Debt Management

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How about leaving on your underclothes when you take a shower? This will save you on the amount of laundry that you have to do because you already have your smalls washed. How about using your tea bags the second time for your second cup or cutting them in half so that you get two cups of tea from one tea bag? It is quite easy to do by sewing two extra rows of stitches down the centre of the bag. These may seem like extreme measures, but many people are finding money very tight right now and are resorting to such measures.

Many hotels and other locations that cater to groups gathering for meetings offer free coffee. Simply watch the newspaper or TV to find out where such events are being hosted and pop in to receive your coffee free of charge. You can have a cup at the location and take one with you for the road. Bview.co.uk has collected numerous money-saving tips such as these that will help you cut down on some of your household expenses.

Taking extra packets of condiments, such as ketchup and mustard, at restaurants and take-aways is something that has been used for years to save money at home. You can store them in a drawer in your kitchen or even pour them into your empty bottles at home if you don’t want visitors to know that you have been collecting in this manner.

Order a glass or water with slices of lemon when you eat at a restaurant instead of paying for a glass of lemonade. Add sugar from the table to sweeten it to your taste. If you go out to the pub for a drink with your friends, you will have to buy a round of drinks. However, you can save on this too by being careful to be the last one to buy a round, especially if there are four or more in your group. By the third or fourth round, the others will have forgotten whose turn it is to pay and you can get away with having free drinks for the night.

Wash your car using the squeegee at the local petrol station or go through the lost and found at the rail stations to acquire some items that you need. You do have to be careful when you start scrimping though so that you don’t do something illegal and end up in more trouble than you bargained on having.

Kath Kelly is a prime example of a scrimper who managed to live on £1 per day for a twelve-month period. She found free buffets for her meals, shopped at church jumble sales for her clothing and bought the produce at supermarkets just before closing time when it was offered at reduced prices. As part of the challenge, Kath’s rent and utility bills were paid for the year, but she still had to survive on this budget and pay for all her other needs.

One of her tactics included picking berries from bushes to supply her diet with fruit. She became an expert at picking up loose change on the street, amassing over £100 in the year. Kath, who is an ESL teacher in Bristol, said her friends thought she was crazy to take part in this challenge thinking she would be freeloading off them during the year. However, she says it was not like that at all and she became the “queen of the buffet.”

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However, the ongoing financial crisis and slumping economy resulted in the Bank of England deciding to slash the base rate in a series of dramatic cuts last year, and between October of last year and April of this year the base rate fell to just a tenth of its level, dropping from 5 percent in October to just 0.5 percent by April.

Of course, for those on variable rate mortgages this has resulted in repayments plummeting. After a period of financial hardship the cut in base rate came as a welcome relief to many homeowners, with some finding that their repayments have been cut by a huge amount due to the lower base rate. Since April of this year the base rate has remained unchanged at 0.5 percent, which is the lowest level in the three hundred and fifteen year history of the Bank of England. Furthermore many industry officials have predicted that in the current climate the central bank plans to keep the rate at this level until around the middle of next year, at which point rates may start to rise again.

This means that consumers who are saving money because of the lower interest rate should think carefully about how to most effectively use this extra money before rates start to rise again, and there are a number of options open that could really benefit you in the future in terms of your debts and finances. Many homeowners who have seen their repayment requirements drop through the floor have already realised just how invaluable this extra money can be towards their future, and have found far more effective ways of using this cash than just blowing it.

One obvious and very effective way in which you can use this extra money is to overpay on your mortgages, and this will benefit you in many ways. You can save huge amounts of interest to the tune of tens of thousands of pounds in some cases simply by overpaying on your mortgage repayments each month. What’s more you can also reduce the term of the mortgage by a significant number of years, so you will pay far less and clear your mortgage debt far earlier.

If you do not wish to use the extra money to make top up payments of overpayments on your mortgage there are also a number of other effective ways in which you can use this extra money. If you have credit card debt hanging around your neck then it can be very beneficial to make extra payments on your credit card balances with the extra cash, as this will help to release you from this burden of debt, and could save you years of repayments and a fortune in interest.

You could also put the money towards other debts such as loans and car finance, which again would rid you of debt far earlier and could mean big savings in interest. Using the extra money to pay off your debts will help to release you from repayments far more quickly, and the very low interest rate at present provides the perfect opportunity to do this. For homeowners the general consensus seems to be that overpayments on mortgages is the best option, so this is definitely something that you should consider.

Using the low base rate to clear your debts is a post from: Nicon Debt Management

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Statistics of the amount of interest that UK wage earners pay on an annual basis takes up until the end of March before you can say that your earnings are actually going to start paying on your outstanding balances.

The majority of consumers in the UK are struggling to keep their heads above water with the debt load they are carrying. This has been further compounded in the last year with the downturn in the economy resulting in thousands of companies shutting their doors and the employees being laid off.

If you are drowning in debt and are having trouble making ends meet, it is good to know that there are ways you can get out from under this heavy load and the accompanying stress. The first thing you have to do is admit that you are in financial difficulty. The problems won’t solve themselves and they won’t go away simply because you choose to ignore them and not make any changes to your lifestyle. You do need to respond to any requests for payment by at least explaining to the creditor why the payment is late and even offering to make a partial payment. By ignoring the constant requests you are not only deceiving those who extended you credit in good faith, but you are also deceiving yourself.

In order to get a handle on what you actually owe, you need to sit down and make a list of your debts. Include the outstanding balances on each one, the rate of interest charged and the due dates. Include your mortgage or rent payments, and the amount you spend on groceries, clothing and leisure. This will help you plan how you can repay the debts. Start with the ones that are the most urgent, such as accounts that are in arrears or ones that have high rates of interest.

By making a budget for yourself for the month, you will be able to see how much money you do have left over for discretionary use at the end of the month. You can also go over the list to see where you can cut some corners to cut out wasteful spending, which is something that everyone has. Use the extra money to make extra payments on some of your accounts, such as the one with the highest interest or the one with the lowest balance so that you can have it repaid sooner and this will free up more money.

There is always help available from professional counsellors in the field of debt advice that won’t cost you any money. Such services are free and if there is a cost involved, you should avoid using this service. Consumer Credit Counselling Service is one such charity that specializes in helping people with their debt problems and have ways of helping you repay your debts.

Try to pay off any store cards first because these do carry a high rate of interest. You can also shop around for a credit card with a lower rate of interest or possibly one with no interest charges for a specified period of time. This will enable you to pay off more of what you owe instead of paying it away in interest.

Look into switching energy and telephone providers. It is quite possible you can save yourself a lot of money by taking advantage of special offers for new customers with different companies. Switching your mortgage to a different lender is also an option and is not as daunting a task as you may think. With interest rates at an all-time low, there has never been a better time to switch to a fixed rate mortgage and have a lower monthly payment. If it is a possibility in your financial circumstances, you may even be able to switch to an interest-only mortgage giving you the extra money you need to clear away your other debts.

Take a close look at the amount of money that you spend in luxuries. For example, if you usually dine at restaurants several times a week, you can cut this back to once a week. You will be amazed at how much money you can save in this manner. You may have some extra time on your hands and be able to take on a part-time job, which means you can make more money to pay your debts.
You do have to realize that it takes a lot longer to get out of debt than it does to get into debt. It will take time and patience to turn your finances around.

Helpful Advice for Those Drowning in Debt is a post from: Nicon Debt Management

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The fact that credit conditions have become so much tighter over recent months has not stopped consumers’ needs for finance – in fact, quite the contrary, because as credit conditions have become tighter living expenses have become higher, and this has made it even more necessary for many people to borrow money. However, with mainstream finance now well and truly out of reach for many people – especially those with damaged credit – the only alternative is to seek assistance from a doorstep lender.

Doorstep lenders have commonly been associated with offering finance to lower income people who have traditionally been unable to get finance elsewhere, and have also been linked to high rates of interest. One well know doorstep lender, Provident Financial, which also owns the high interest credit card Vanquis, which caters for those with damaged credit, recently reported that in the first half of this year there had been a rise of 34% in business, which clearly shows that an increasing number of people have been turning to lenders such as these as an alternative to banks and other mainstream lenders.

One industry official recently stated: ‘With the ongoing tightening of credit scorecards by high street providers, some of those seeking unsecured borrowing will face the prospect of even higher monthly repayments or being turned down for loans for which they would have previously been accepted.’

He added: ‘The tough economic conditions will see the likes of Provident Financial continue to fill its boots as the bigger lenders remain far more selective about the type of customers they are prepared to lend to. Whilst consumers may still be able to get their hands on unsecured funds, some are going to be faced with paying rates they would have dismissed out of hand just 12 months ago.’

Whilst many people have certainly gone down the doorstep lender route, those with decent credit ratings should bear in mind that there are still personal loans available from traditional lenders, and that by comparing different loans from a range of lenders they may still be able to get a competitive deal on their borrowing. Comparing loans can be done with ease and convenience online, and could save you a lot of money in interest compared to some of the more expensive alternatives.

Are more people turning to doorstep lenders? is a post from: Nicon Debt Management

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However, a recent report has shown that there has actually been an unexpected drop in insolvency figures in England and Wales, and some officials have stated that this could be down to the fact that people are being far more cautious with their spending as a result of the ongoing global credit crunch. Insolvency levels in England and Wales have been falling for a number of years, but in the first three months of this year insolvency levels increased, and were expected to go on increasing due to the current economic and financial climate.

However, between April and June there was actually a drop in the number of insolvencies, falling by 2% to 24,553. The Insolvency Service has released these figures, and claims that the latest figures reflect a drop of 8.3% compared to the same period last year. The fall has been reflected in both the number of people filing for bankruptcy and the number of people entering into an IVA, or Individual Voluntary Arrangement, which is considered a softer alternative to bankruptcy.

However, whilst insolvency figures are down DMPs, which are informal arrangements made with creditors relating to repayments, are thought to be on the rise. Some officials have said that the drop in insolvency levels could be down to increased caution from consumers who are being as careful as they can over their spending as a result of the financial climate.

One official from the Insolvency Service stated: ‘I’m not sure the credit crunch is the sole factor in the decrease, but it is definitely affecting people’s decisions on how they should handle their debt. It is impossible to pinpoint one particular reason from these figures, but economic conditions and available credit are factors.’

Another industry official said that whilst insolvency levels have fallen ‘it’s important to bear in mind that this is from historically very high levels. The rates are still significantly higher than during the previous five years and I would expect this general upward trend in personal insolvencies to continue in the short to medium term.’

Over recent years IVAs, which are one form of insolvency, have been heavily advertised by a number of firms, who have been persuading consumers that they could write off a huge amount of their unsecured debt by entering into one of these agreements, but officials have warned consumers to think about the long term consequences before rushing into this course of action.

Insolvency figures drop whilst DMPs rise is a post from: Nicon Debt Management

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However, just as interest rates started to fall, living costs and bills started to rise, which meant that many households were still facing real financial problems. In addition to crippling household costs, many homeowners have been faced with trying to get a more affordable mortgage when their cheap deal comes to an end, but with the mortgage drought still ongoing there is very little around, and many have been forced to switch to their lender’s expensive standard variable rate because they are either unable to get a cheaper mortgage or they cannot afford the crippling arrangement fees that come with switching mortgages.

These and other factors have seen the level of repossession for the first half of this year rocket, and according to recent reports repossession levels have soared by 41% in the first half of this year. Industry officials have said that repossessions have now hit the highest level since the middle of the 1990s, with nearly nineteen thousand properties seized by lenders after homeowners failed to keep up with mortgage repayments according to the Council of Mortgage Lenders.

Michael Coogan from the Council of Mortgage Lenders stated: ‘The number of people facing difficulty needs to be kept in perspective. The good news is that most people are coping well and continuing to pay their mortgages in full, despite the higher costs of food and fuel and the higher mortgage rates now prevailing in the market for those coming off cheaper original deals. But it is inevitable that more borrowers’ coping strategies will come under pressure in current conditions than in the unusually benign years of the last decade. That’s why lenders, government and the advice sector are working closely together to minimise the impact on borrowers. ‘

He added: ‘No-one wants to see a household lose their home, and repossession typically leads to a loss for the lender as well. The focus of lenders’ arrears management policies today is on seeking realistic alternatives that balance the interests of customer and lender. Anyone who thinks they may be heading towards financial problems should contact their lender to discuss their options – the earlier the better.’

Repossession levels have rocketed in the UK is a post from: Nicon Debt Management

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