Here are some simple steps you can take to start dealing with your debts.
Step 1. Identify your debts.
List the details of all your debts and who you owe money to. Then make sure you know if you or the other parent is liable for these debts.
Step 2. Prioritise your debts.
- Some debts are more urgent than others.
- Priority debts could lead to you having your gas or electricity cut off, losing your home or being sent to prison.
Step 3. Make a budget.
- A simple household budget can help you manage your money.
- It can also show lenders and the other parent’s advisers what you can afford, or how much you and your child need to live on.
- Complete your budget honestly and keep it up to date.
- Adjust your budget when your income, expenses or priorities change.
Step 4. Negotiate debt repayments.
- Take advice from a specialist debt counsellor. They may tell you to contact all your priority creditors and make an individual repayment offer to each of them.
- You may be able to negotiate a repayment plan with your lenders, taking into account your circumstances. You can ask the lender to stop interest and charges while you make smaller repayments, sometimes as little as £1 a month.
- If you have any money that could be used to pay off your debts, your lenders will expect a fair share.
Step 5. Get everything you are entitled to.
- Make sure you and your family are getting all the benefits, tax credits and other income you are entitled to. Check you are being paid the right amount.
- If you are the main day-to-day carer of your child, you should get child maintenance from the other parent. If you are not getting child maintenance, call us and we’ll talk you through your options.
Step 6. Spend less.
- Write down all your regular expenses and then see what you can reduce.
- Save money by shopping around for the best deals on gas, electricity, water, phones, credit and insurance.
