Tips On Getting Out Of Debt And Staying That Way*

*This is a collaborative post*

Most of us will need financial help at some point in life. Whether it be for buying a first car, for doing home improvements or paying for dental treatment, the average person will need to take out a loan or apply for a credit card in order to get by in life. The cost of living has - unsurprisingly - gone up. When does it not? For many it's now almost impossible to manage without taking out credit. Whilst it's good to have these options, it also pays to be sensible.

Unfortunately for many people, these measures can also cause serious debt problems. Whether it be down to bad choices, living beyond our means or just borrowing more than we can realistically afford to pay back, once you're in financial dire straits you need to acknowledge the problem before it gets any worse.

I'm not ashamed to admit that I've had financial problems. I've had loans and credit cards in the past and inevitably I got myself in a pickle. The month I realised my outgoings were more than my income I started to panic. A white hot kind of panic which brought about the realization that I was in a bit of a mess. In the end it was all okay, I spoke to my parents and also to a debt charity. The result as many of you know by now is my debt management plan which means I pay one affordable monthly payment. I've definitely learnt from my mistakes! Here are a few tips for those of you who are in debt;

Do Not

Bury your head in the sand or ignore debt letters
Keep over spending
Take out more credit without seeking financial advice first
Miss monthly payments
Go it alone. Trying to get yourself out of debt alone is stressful and rarely works anyway

Admit you need help
Prioritize your debt
Budget
Seek help from a debt charity or debt relief company

When you've been in financial difficulty previously it can mean that your credit rating has been negatively affected. Details of any missed payments and court action can remain on your credit file for six years in the UK and approximately seven in the States. Whilst it's not advised to take out more credit when you're already in serious financial difficulty, once you are in the clear, there may very well come a time when you want or need to take out a loan.

Don't despair when the time comes if it seems as if no-one wants to lend you money. There are solutions out there such as bad credit loans via companies like The Associates Home Loan who don't even do a credit check!

Obviously the most sensible idea is to not get into debt in the first place or to at least learn from any mistakes. Below are some pointers on how not to get into debt;

Don't spend or live beyond your means
Do learn to budget
Do avoid racking up debt on store cards or via online retailers such as Very. - As tempting as the buy now pay later sounds, when the 'later' finally comes around - which it will, - if you don't have the money to pay off the bill, the interest will start building each month
Do use credit cards for emergencies only
Do be aware of how bad debt will impact you financially in the future
Do build an emergency fund
Don't miss payments
Do only borrow what you know you can afford to pay back
Do seek help as soon as you spot signs of financial difficulty