How To Keep Down Non Mortgage Borrowing Debts
With family debts rising to an all time high, and households owing almost £9,000 in non-mortgage borrowing, I’ve decided there’d be no better time for me to share with you all my top ten tips to help families keep down their non mortgage borrowing debts. If you struggle with money management, then you can easily take back control by making just a few small changes.
Total outstanding unsecured borrowing grew by nearly £20 billion in 2014, however if you are struggling to keep on top of your finances, try following these tips to help you save money before interest rates rise.
- Repay your loans with savings wherever possible! I think it makes sense to pay off any of your outstanding loans with your savings, provided the early repayment charges aren’t too high.
- Secondly, if you have several debts to clear such as credit card debt, store card debts, unauthorised overdraft or pay day loans, aim to clear the most expensive ones first. It may seem like an obvious point to make, however it’s very tempting to pay the smaller debts off first once you see you have enough money to do so.
- You can still save if you have some debt, as long as you’re still paying your credit card bill each month, or you don’t have any other loans or credit commitments that are costing you more in interest than you could earn on your savings. As long as the debt isn’t out of control, in which case you should focus all your savings towards clearing it, then feel free to keep some aside for savings.
- I know credit card debt can be expensive. Bank base rates are the lowest they have ever been at 0.5%, yet the average interest rate charged on a credit card is 18% annual percentage rate. Transferring your balance to another credit card that pays a lower interest rate may be a huge help in terms of reducing your monthly payments.
- A 0% balance transfer card is the easiest way to pay off smaller debts. Transferring some or part of a debit balance you owe to another lender can be transferred from one credit card to another, this saves money on interest rates.
- Try setting yourself a budget to help you take control of your money. Keep a record of the money you have coming in and what you have left to spend each month. By doing this you should be able to identify areas where you can reduce your spending.
- When borrowing money, don’t simply look for a loan with the lowest monthly repayment. Before you sign on the dotted line, it’s essential that you know the total cost of repaying the debt.
- I’ve said this before, but switching your utility bill supplier really could save you £100’s each year on gas, water, electricity and phone bills just by switching deals. Some people get comfortable with their suppliers and prefer not to stick with their old deals. However the older the deal, often the more expensive it is. Try ringing up and enquiring about other, cheaper options.
- You can even save money by switching your insurance company. You can often save big money by on cheaper car cover by phoning around or looking through price comparison sites.
- Paying all of your utility bills by direct debit could be a great idea if you struggle to manage your bills as you won’t have to worry about sending cheques on time. The even better news is, most providers offer discounts for direct debit payments.
- As you’re all probably aware, the cost of fuel is at an all time low. However make sure you are getting the best value for your money by comparing petrol prices online at www.petrolprices.com .You can enter your postcode and the site will tell you where the highest and lowest prices can be found in your area.
CLICK HERE to find out how bad driving habits could end up costing you a fortune!