Debt management help – 4 steps to get you back on track

I don’t know about you, but debt has always been something I was wary of when I was younger however, when I stop and think about it, it’s like the world has set it up so you would somehow find yourself in some form of debt.  If it’s not an overdraft allowance, it’s student loan debt and if it’s not a mortgage then maybe it’s a car repayment loan. Whatever it is, I realised that being in debt, to some extent, was like a rite of passage into adulthood, but unfortunately, debt has both its good and bad points.

Not all debt is bad, especially if you can afford to pay it back and you knew what you were signing up for, i.e., a mortgage. What I want to talk about is the debt you find yourself in where you are worried about how you will pay the next bill.

There are some people who don’t actively seek to get themselves into debt but unfortunately, they find themselves in debt because of a number of things, for example, losing their jobs or having to take on a loan for someone else. So, whether its a housing debt, a utility bill debt, a business debt, or a government debt, here are 4 practical things you can do right now to help you manage your debts.

1.    Understand your income and outgoings

The first and most important thing you have to do is understand how much money you have coming in and how much you have left over when you have dealt with your necessary outgoings like food, travel for work, immediate gas and electricity bills (as some people may be in arrears).

By understanding the flow of your money, you are now able to tackle the next step.

2.    List all your debts, then prioritise them

It is important that you know which debts you need to pay off first. For example, if you have a credit card debt and you also have rent arrears, then paying your rent in this instance should take priority because that addresses your need for shelter. You need to understand what your immediate expenses are and exactly what your debts are because the order in which you prioritise them will determine how you pay it off.

I am not a financial adviser but my aim is to raise awareness of this prominent issue of debt, (especially with the COVID 19 crisis we are currently faced with and a number of people being out of work), and direct you to the different charities/companies out there that can help you right now, to manage your debt.  Stepchange (a charity that helps people deal with their debt problems) have provided a helpful guide to assist you in determining the order of priority for your debts, CLICK HERE to go directly to their website.

3.    Try to pay off your debts based on your financial circumstance

Now that you know what you need to pay off first, look at how much you have left over from your income (you should have this figure after carrying out the exercise in step 1), then work out how much you can actually pay towards each debt with the money you have left over.  If you cannot afford the minimum amount they have asked you to pay on a monthly basis, then call them to see if they can lower that monthly amount. Don’t just decide by yourself to pay back less, call them to make sure it is agreed and it has been confirmed in writing.

There are few strategies you could adopt to help pay off your debts, but I have listed just two ideas below to get you started, the snowball strategy and the debt stacking strategy.

a. Snowball strategy – this debt reduction strategy is where you pay off your smallest debts first, then roll the amount you used to pay those first debts into paying off your bigger ones. You always pay the minimum payments towards all your other debts, but anything left over from the total money you have set aside to pay off all your debts, goes towards the smallest debt first. The advantage of this strategy is that you are likely to pay pay off your debts faster, however, a disadvantage is that because you are tackling the smaller debts first, the interest rates on the larger debts, depending on the rate, adds to the debt each month.

For example, let’s say you have 3 debts and you have set aside £200 to pay towards all your debts each month.


  • Debt 1 = £130 (£20 minimum payment) + £110
  • Debt 2 = £160 (£30 minimum payment)
  • Debt 3 = £250 (£40 minimum payment)

So minimum payments for all 3 debts = £90

Money left over from the £200 you have sent aside to pay debts = £110


  • Debt 1 = £130 (£20 minimum payment)   PAID OFF
  • Debt 2 = £130 (£30 minimum payment) + £20 debt 1 minimum payment + £110
  • Debt 3 = £210 (£40 minimum payment)


  • Debt 1 = £130 (£20 minimum payment)   PAID OFF
  • Debt 2 = £160 (£30 minimum payment) PAID OFF 
  • Debt 3 = £170  (£40 minimum payment) + £20 debt 1 minimum payment + £30 debt 2 minimum payment + £110

b. Debt stacking strategy – this debt reduction strategy is where you pay off your debts in the order based on their interest rates, with the highest rate debt being paid off first. So, a very similar approach to the snowball debt strategy, but instead it works the other way round. The advantage of this strategy is that you will pay less in interest because you are tackling the large debts first however a disadvantage is that it may take you longer to pay off your debts. 

For example,


  • Debt 1 = £250 (£40 minimum payment) + £110 
  • Debt 2 = £160 (£30 minimum payment) 
  • Debt 3 = £130 (£20 minimum payment) 


  • Debt 1 = £250 £100 (£40 minimum payment) + £110 
  • Debt 2 = £160 £130 (£30 minimum payment) 
  • Debt 3 = £130 £110 (£20 minimum payment)


  • Debt 1 = £250 (£40 minimum payment)   PAID OFF
  • Debt 2 = £130 £100 (£30 minimum payment) + £40 debt 1 minimum payment + £110
  • Debt 3 = £110 £90 (£20 minimum payment) 

4.    Speak to a free debt adviser 

If you are still finding it difficult to make payments or manage it on your own, then speak to a debt adviser.  A free debt adviser will provide you with free, impartial and confidential advice tailored to your situation. 

Guys! PLEASE DO NOT STRUGGLE with this on your own. That is the worst thing you can do i.e. keeping silent and think it is all going to go away.  If you don’t have anyone within your circle of friends or family or you don’t want them to know, then please speak to an expert, someone who knows nothing about you but can give you impartial advice on how best to manage your debts. 

Silence is not the answer and debts simply don’t go away, so the sooner you reach out for help, the better. There is no shame in asking for help, NONE! NONE! NONE! I can’t emphasize this enough, reaching out for help does not diminish your success or the goals you want to achieve in anyway, in fact, it does the opposite because it moves you closer to them.

So, if you take anything anyway from this, it’s that yes, being in debt is not the best place anyone wants to be, but if you do find yourself in a place where the worry and the stress is affecting you, then know that there is a way out, but it starts with you taking control of your finances and reaching out for help if you need to.

I have included a few links below to some really helpful charities and websites to help you get more information.



  1. Pelumi
    May 27, 2020 / 11:07 pm

    Great post

  2. May 28, 2020 / 10:23 am

    Really detailed and good advice. Best thing is to get your head out of the sand and start communicating. Get payment plans in place. So the examples are great !! Looking forward to reading more xx

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