It can be difficult to avoid debt if the money coming in is less than what is going out. But it’s not impossible. Making some small changes to your lifestyle and shopping around for better deals can help you stay out of debt and even start to save.
Recording money coming in and going out is essential to good budgeting. Write in a notebook every time you spend money. Include automatic payments like your rent or phone bill and all essential and non-essential items.
If you have a computer, you could put this information into a spreadsheet. Download a budgeting app to your smartphone or ask your bank if they have a budget planner for online customers.
Once you know where your money is going, you should put your bills in order with the most important first. These are rent or mortgage and heating, plus the bills you have to pay by law like Council Tax. You should also include a budget for food.
Buying your groceries online will save you the price of a taxi or bus to the supermarket. If you use the same supermarket to shop online, you can save your shopping list so it will not take so long to order the next time.
If you have milk or newspapers delivered separately, you might want to get these as part of your online grocery shop to save on delivery costs.
Large supermarkets, high street chemists and department stores have loyalty schemes where you earn points or vouchers. Build these up over time and use them to buy food or gifts for a special occasion.
Credit cards can be useful if you want to spread the cost of a big purchase. Look for a card that allows you to pay the bill over a longer time and without interest. Some cards include travel insurance or roadside recovery as standard.
Consider switching to a new card once any promotional period is over. Price comparison sites can help you find the best deals.
Warning Credit card debt
Use credit cards with care. You could get into debt if you do not pay your bill on time and in full. Always read the terms and conditions.
Mortgage payment holidays
If you think you’ll not be able to pay your mortgage, speak to your bank immediately. They will want to help you.