The Dos And Don'ts Of Ditching Debts

If you are really serious about getting yourself financially straight, it is vitally important that you abandon all thoughts for the time being of taking a holiday, getting a better car or replacing your temperamental VCR or DVD player. Many people roll out this sort of excuse: "I've got huge debts of £30,000 -- so another £500 won't matter! And besides, I really need a holiday because I've been worrying so much recently!"

But you need to grasp the fact that you could be risking the roof over their heads for the sake of a short-term happiness fix. It's understandable to want to get away from it all when everything is crowding in. And, if you're the sort of person who does this kind of thing, we're not going to beat you around the head with a cricket bat. We're just trying to make you screech to a sudden stop and think!

If you're honest with yourself, you'll probably realise you're in a bit of a mess right now because the costly fun things took priority instead of the essentials. It's far more satisfying to pay for something by yourself, instead of borrowing it from someone else at vast expense and then worrying about how to meet the bill.

If you want the occasional treat to keep you going while clearing your debts, pick a small one such as a book or a CD. Don't forget that, when you were a child, small things gave you an immense amount of pleasure. They still can. You really don't need the expensive things.

So, if you've decided to get your act together and to tackle your debts -- then here are a few small tips on the Dos and Don'ts:

Do:

• make sure that all your scheduled payments are set up to leave your account the day after your salary is paid into it. That way you'll get the bills out of the way before you get a chance to spend the money on other things.
  
  
• consider getting a second job for a short period. You may not feel like working behind the bar of your local three nights a week but it'll mean you'll get your debts cleared more quickly.
  
  
• think about taking a lodger. Under the Government's Rent-a-Room scheme, you are allowed to 'earn' some £4,250 a year without paying tax on the income. You will need to agree this with your mortgage lender as well as your insurance company, and check how it may affect any benefits you may be receiving, but it can prove to be an effective, easy and temporary solution to immediate financial problems.
  
  
• a car boot sale? It takes effort but they can be quite fun and it's a good way of getting rid of some of the clutter you've accumulated over the years. Remember to sell only stuff that belongs to you -- anything bought on hire purcahse isn't yours to sell until it's paid off. And don't be picky about the quality of stuff you sell -- some people will honestly buy anything. After all, you did!
  
  
• make sure you that, if you frequent the same supermarket for your food and petrol, that you collect your points whenever you buy anything. Over a period of a year, the loyalty points on your weekly shop can amount to enough to fund your entire food and booze requirements for Christmas! Alternatively, you may find it's cheaper to shop around. You won't have the convenience of buying everything in one place, but meat and veg is likely to be cheaper at your local market rather than the supermarket.

Don't:

• be tempted to go to a debt counselling company that charges a fee for their services -- your money would be far better used paying off the debts and the Citizens Advice Bureau offers the same service for free.
  
  
• be tempted by offers of loans from mysterious companies in the back of national newspapers -- the interest rates are usually astronomical.
  
  
• go food shopping on an empty stomach and never go without a list of what you actually need. You'd be surprised how pushing the trolley around the supermarket while your stomach's rumbling makes you want to grab everything off the shelves. Don't miss out on the regular buy-one-get-one-free or three-for-two offers on your regular purchases either. You will always need washing powder and toothpaste after all!
  
  
• be a snob when it comes to buying clothes -- Oxfam and Save the Children are perfectly good shops and there are bargains to be had!