Manage your debt
If your financial situation seems like it is unmanageable then it might be a good idea to seek advice. In this short guide we take you through some options you have to manage your debt.
Managing your finances can be stressful when things are not going well.
If your financial situation seems like it is unmanageable then it might be a good idea to seek advice. In this short guide we take you through some options that you have to manage your debt.
Can I pay a loan back early?
It is usually worth paying off your debt obligations as soon as possible as this reduces the total amount you will need to repay. Many lenders will allow you to do this. However, it is worth checking whether or not your lender charges you an early repayment charge as this might negate the benefit of paying off a loan before the repayment term is up.
Can I get support managing my debt?
Yes, a second opinion might provide you with solutions that you could not see or did not even realise were available.
One option is to look at the Money Advice Service website, which offers suggestions ranging from debt consolidation loans and loans from not-for-profit organisations, local authorities, or the Social Fund for example. They provide a free ‘debt health check’ which asks some simple questions about your debts and then provides some targeted next steps to get things back under control.
The Money Advice Service also provides links to free and confidential online, telephone and face-to-face debt advice services.
If you are struggling you may also need some additional support. Check if your employer provides an Employee Assistance Programme (or EAP). You may be able to get some free support and counselling in your local area.
Should I pay off my debt if I have the money?
This really depends on your individual circumstances.
One thing to think about is the cost of the debt, as sometimes the interest you are paying could have the effect of putting you in further financial trouble if you let it spiral.
This might be especially true of debt with high interest rates like credit cards or pay day loans for example. Equally, if you have taken out an emergency loan to cover short-term living costs, you might want to ensure you have some contingency cash in place so that you do not find yourself in the same position.
The Money Advice Service is part of the Money and Pensions Service.