I've been quite lucky and never really owed any large amounts of debts apart from the odd store card which I became obsessed with using and always maxed their limits during my teenage years. I've now paid off all of these - even if they have taken nearly 5 years due to silly charges. I'll be sharing my tips on how I paid these of later in the week however today I thought I'd share some of my tips for budgeting in order to pay off any debt you may have occurred. 

It's so easy to get into debt because of university, car finance or even when buying a house and it can go unnoticed for months upon months but it's definitely not so easy to get out of. The first thing you need to do is accept that you are in debt and no longer try to avoid it.

1. Work out your budget

In order to work out how much of your debt you'll be able to pay off each month you need to know where you currently stand financially. This shouldn't take you long to work out and once you do you'll feel at ease.

Make note of all your monthly income and all of your expenses from rent, bills, petrol, food and everything else. Then add up your monthly spending and take it away from your monthly income. This will give you an idea of what you have left to work with.

2. List all of your debt

Now that you've worked out your finances you need to figure out how much debt you owe. Write every single debt you owe down from the lowest to the highest. This stage may be depressing but don't give up. You'll soon be on your way to getting your debt situation under control. By listing all of your debt you can then figure out how much you have to work with.

3. Work out how much of each debt you can pay off

From the money left over from your income after your expenses have all been accounted for you will need to figure out how much money you can spare to pay off your debt. If you don't seem to have as much as you thought you could try and cut your current bills down by switching providers. There's no need to change your lifestyle dramatically unless you don't have any budget left over at all. You could cut back on a takeaway each week or stop smoking.

4. Set up direct monthly payments for all your debts for the minimum payments

I suggest paying only the minimum payments on the lowest debts so they are still being paid off and that way you can concentrate on paying off the biggest debts or at least saving to pay them off.

5. Consider a balance transfer credit card which could help you to move all of your debt onto one card while paying no interest for a set period. This will help you to pay off all of your debt in one go and much easier to manage.

Here are some other things you can do to stay clear of debt once you've paid off all of your debts

+ No takeaways for a month
+ Plan not to eat out for a week and shop for lunch meals instead when doing the weekly shop
+ Meal plan for the week so you won't overspend
+ Use cash only when out and about no cards of any kind for all of your purchases
+ Reduce your monthly utility bills and see if you can swap companies
+ Put your credit card away for a week or if you're really brave cut it up and put it in the bin!

Do you have any advice on how to pay off any debts? Have you ever been in debt before?

* In collaboration with TSB 

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  1. I have a little bit of debt due to some silly choices a few years ago. I started paying a bit more attention to paying it off at the beginning of the year and swear by making payments daily to knock just that little bit more off (of course as well as making the minimum payment first!)

    Sam x

    Simpliste Daily

  2. These are great tips! I love that you use your bank's app too, I haven't even downloaded it yet! x

  3. Great tips hun... always good to pay off debts before you plan on buying something. Sometimes guideance is needed to do that.


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