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Tips For Climbing Out Of The Downward Spiral Of Debt For Good

According to recent statistics by Aviva, the average household debt in the UK is more than £10,000. This includes loans, credit cards, hire purchases and overdrafts. Families find themselves struggling to pay off these debts, as their cost of living continues to be high and interest rates add up more and more.
Getting yourself trapped in a cycle of debt can be very easy to do. One day you are absolutely fine; maybe living pay cheque to pay cheque or perhaps with a small amount of savings. Then something unexpected happens. Perhaps your car breaks down and you need to pay for repairs, or you lose your job for a while and are unemployed for a few weeks or months while you find another one. Whatever happens, you find yourself needing to borrow a little bit of money to keep yourself afloat and perhaps start charging a few items to your credit card.

Sinking in Quicksand: Fast!
Once the cycle begins, you will find yourself falling deeper and deeper into the trap. If you cannot pay your loans and credit card bills back fast enough, you will have to pay interest which will reduce your income even further. Eventually you will find that a large chunk of your wage has disappeared to interest payments before you can even get started on paying for your weekly expenses and paying back the principal of the loan.
Once you have gotten into the cycle of debt, it can be much more difficult to climb back out of it. The best thing to do is to save up an emergency fund which can cover you in an emergency so that you can avoid going into debt in the first place. However, if this is not possible then you will need to find a way to get yourself out of debt. It will be difficult for a while, but once you get yourself back out of the red then you will be able to take charge of your finances for good.
Here are some tips to keep in mind that will help you on your path to get out of debt:

  • The first step is to get organised and to outline all of the debts that you have. How can you make a plan for paying everything back if you don’t know how much you owe? It might be scary to face the numbers, but the problem needs solving. Total up all of your loans, credit card bills and other debts so that you have a clear picture of what you are up against.
  • Take this information and put it into a spreadsheet which you can update as you pay off each of the debts. It will help you to stay motivated if you can see your progress as you go along.
  • While you are paying off your debts, stop accumulating more! If you can’t resist the urge to splurge, put your credit card in a bowl of water in the freezer. Every time you need to use it to make a purchase, you will need to take it out and let it thaw. Forcing yourself to wait will make you think about whether you really need that purchase after all.
  • Cut out all unnecessary expenses. Take a look at your monthly expenditures and see how much of a basic frugal lifestyle you can lead for a while.  Stop eating out and cook your own cheap meals at home instead. Spend nights in rather than going out to the movies or on a night out. Don’t buy any electronics, new clothes or other luxury purchases for a while.
  • With all of the money that you save from cutting down your expenses, put it straight towards paying down your debt.
  • Another way to manage paying off your debt is to make some extra money that you can put towards reducing your principal. You could take on some overtime hours at work to make a bit of extra cash, or start another evenings and weekends job on the side. You might have to work a bit harder than you would ideally like, but this extra work can be a temporary situation to help you get out of debt and once you have achieved your goal you can go back to your regular work schedule.
  • Once you have paid off your debt, stay frugal for a little bit longer so that you can save up an emergency fund to cover yourself the next time you get into trouble.

Follow these tips and make paying off your debt a priority and soon you will be out of the debt cycle and onto a better financial situation. Afterwards, continue to spend less than you earn and you should never need to get trapped in debt again.
Bob Emerald is a freelance writer who paid off her debt of nearly £10,000 in 14 months with smart budgeting and financial planning. He writes for, a service that helps over 1,000 people every month with their debt management.

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