Money plays a huge part in most people’s lives, and although it can’t buy happiness, most people believe it does help towards it to some extent! Being financially secure can reduce the pressure and stress from other areas of an individual’s life, such as their relationships, work and lifestyle. However, those who are struggling financially may feel enormous pressure to provide for themselves and their families. If bills can’t be paid at the end of the month, or debt has mounted up into an unmanageable amount, many people find themselves in an extremely stressful situation.
According to research, UK personal debt currently totals £1.4 trillion and there was a 15% increase in debt advice calls to Citizens Advice in the last year. Five million people, or one in ten adults, spend more than they earn on a monthly basis and half of those living beyond their means rely on overdrafts and credit cards (figures from the BBC, 2008). So if you’re experiencing financial difficulties you’re definitely not alone and the good news is that there are plenty of organisations who offer debt advice to help you get on top of things.
There are many reasons why individuals get into debt, generally though the reasons often involve a change in their personal circumstances such as divorce, a new baby or a job loss. Facing up to debt problems as soon as possible and getting some debt advice is best, as ignoring the situation won’t make it disappear. These few initial steps can help begin with the management of debt:
- Decide on a budget and prioritise debts.
- Contact creditors and let them know your situation.
- Offer to pay off the debt at an affordable amount, even if this is small.
- Resist unnecessary spending.
- Cut up store cards and credit cards.
- Try to find ways to earn a little extra money, perhaps work more hours if possible.
- Get some money advice from friends, family and professionals.
There are organisations that can help with debt management: Consumer Credit Counselling Service, National Debtline and Citizens' Advice Bureaux all offer free money advice for those struggling with debt problems. As well as debt advice, life coaching can also help individuals release the stress of financial difficulties, and help them to understand how they can rebuild their life.
It’s not only being in debt that can cause financial stress. Money can affect other decisions too, such as starting a new career, setting up your own business or meeting someone new. Risking current financial security to fulfil a dream may also mean that dream is never fulfilled.
How can money advice from life coaching help with my finances?
A life coach can offer money advice and help you fully understand your current debt situation and explore the facts to help you understand how you got into the situation in the first place, and how to make sure it doesn’t happen again. Life coaching debt help can also help you to discover how using a little money can have a huge effect on your current debt situation, and how to alter your thinking about the situation to relieve stress.
Advice from a life coach can also help you look at decisions such as career changes and fulfilling a dream that may risk financial security. Exploring the options and discovering what is most important to you in life may make these decisions much easier to make.
Debt advice - Getting out of debt
There are countless reasons why people get into debt. It may be as simple as over-spending or 'retail therapy' to cope with your stress levels. It could be a lot more complicated, for example, maybe you have taken on a family member's or friend's debt who was struggling.
The very first step on the ladder for getting out of debt is being completely honest with yourself and recognising the reason or reasons for your debt. This is not as easy as it may first seem. Often people in debt have been burying their head in the sand for such a long time that they find it extremely hard to face their issues with money. The access that we now have to loans makes it very easy to run into financial trouble and this can mount up quickly when income doesn't at least match your expenditure. It's no wonder that money worries are such a widespread problem for people in the UK now.
Be honest with yourself
If you're in debt don't despair, there is always a way out and there are many things that you can do if you are experiencing money worries or financial trouble. Getting yourself back in a situation of financial security starts with looking at what got you into financial trouble. To do this, be open about what you are spending, look over bank statements or think about setting up an online bank account which can enable you to easily view your income and expenditure. There are many online applications which will track where your money is going and display this in an easy to read format, such as a graph.
Enlist some help and get money advice
Get your family and friends involved in what you are trying to do as well. Not only will you get the benefit of their financial advice but this will make sure that they think twice before asking you to come out for dinner or encourage you to buy the latest new gadget. Getting help and support from the people closest to you can make getting out of debt so much easier and even enjoyable!
As well as your family and friends, getting money advice from a professional can be absolutely invaluable. Enrolling the help of a life coach is the way to go for many who are struggling with their financial situation. A qualified life coach can give you the extra push that you need to get started with your new life free from debt worry. They are also great at keeping you on track, which can be a big problem for anyone struggling with money.
Look at where you can cut your spending
This is going to be the hard part of your search for financial security. Nobody likes to think that there are things they want that they can’t have, but the truth is that the vast majority of the population have to watch what they spend carefully to avoid ending up in financial trouble. It doesn't have to be as hard as it sounds though, if you are in debt then there are often just a few changes that you can make to cut down your expenditure and be on your way to financial security. Without even getting financial advice you can simply look at where you can cut back on your spending by ridding yourself of bills or subscriptions that you don’t need. These may only be small amounts, but they all add up to make it easier and faster for you to cut down your debt if you can get rid of them. You can also look at contacting your energy providers to cut your bills, or switching to new providers. There are many ways that companies can help you get your debts paid off and it is absolutely worth asking.
Work out how you can increase your income
If you are having money troubles then you are probably spending more than you earn. The only other way of reversing this (other than cutting back your spending) is to earn more. This can be a lot harder to do, and may bring up lots of issues, such as whether you are going to change your career, move jobs, get a second job. It is going to be hard work, but it will all be very much worth it when you are free of financial trouble.
Financial advice - Make a plan
Once you have looked into why you are in debt and worked out what you are going to do about getting out it it, then you need to make sure you make a plan. Writing things down can really help you to face the fear of doing something about it. Your money worries will start to melt away just by getting your fears out of your mind and down on paper. Make yourself a diary so that you know when you have payments coming out and exactly how much money you have coming in.
Plan to get your highest interest debts paid off first, if you can, consolidate your debts onto a card with low interest for an extended period of time and set up a direct debit to avoid missing payments. Cut up your store cards and credit cards that you don’t need to avoid temptation.
It may seem like a massive mountain to climb now, but the hardest part is making a start, once you do this, you are half way there!
Find a life coach offering Financial Coaching
All therapists are verified professionals.