Getting into debt is always far easier than getting out of it; whether it's an unexpected bill, or your washing machine breaking down. If not properly managed, it can weigh you down to a point where you feel you cannot cope.
Before borrowing money or taking out any type of finance agreement always consider the following;
- Do I really need it? Is this purchase necessary at this time? Can this bill be spread over a period? Can I get it cheaper somewhere else?
- Can I afford it? – Do not just consider whether you can afford it at this point but whether you can continue to afford it over a period of time. Take into consideration other expected and non-expected bills that may or will come in.
- Are there any alternatives? Can the debt be paid over a period of time? Is there a family member of friend that could lend you the money to pay back over a period?
- Who is providing the loan? There are a wide range of lenders and the cost and interest rates that they charge will vary massively. A general rule is to approach your bank, building society or credit union first. These organisations tend to have the best rates as well as you having an ongoing relationship with them.
If possible, try to avoid short term, high interest loans that are typically know as payday lenders, As well as being some of the most expensive, the consequence of missing payments tends to be quicker and more severe such as the seizing of goods/items.
We understand that anyone can fall into debt. Firstly, be assured that there is help out there. If you do find yourself struggling to make payments the first thing you should do is speak to your lender. It is in their interest to help you as by doing this they are more likely to get their money back. Often a revised payment can be rearranged over a different period.
Our team here at Financial Inclusion will help to advise you on what the options are. If we are not able to provide the help that you need then we will ensure that we put you in touch with someone that can.
Here is some useful information regarding debt:
- Money Advice Scotland
- Debt and money - Citizens Advice Scotland
- Debt Arrangement Scheme - Accountant in Bankruptcy