The third step towards a debt-free existence

Get impartial, independent advice from leading debt charity, the CCCS on how to take your first steps to get out of debt.

Once you've taken the key step of establishing your monthly budget, detailing all your income and expenditure, you will then know how much your budget deficit or surplus amounts to. 

This will help guide you as to which debt solution best meets your needs. There are a wide variety of options, and your choice must always be based on its suitability for your individual situation. 

It's advisable to seek expert impartial advice from an independent organisation such as CCCS, before committing to a course of action. They can make sure the implications of your choices are fully explained. 

If at all possible, you should always try to pay back what you owe. Various repayment solutions exist, of which the most common are: 

Debt management plans (DMPs)

Settlement offers

 Temporary repayment plans

Administration orders

 Debt consolidation

If none of these are suitable for your situation, you may then want to look at insolvency options. If your debts are out of control and you have no realistic way to pay them back on your current income, and any assets you may have do not cover the balance, this may be the best course of action. 

Since its creation, CCCS's ethos has always been to help the "can't pays", not the "won't pays", taking the view that the best way to tackle debt is to negotiate a way to pay it back in full or in part, based on what you can afford. The charity offers a full range of debt solutions, all free of charge. 

The basis of any debt repayment plan - and indeed insolvency - is a comprehensive budget. A rigorous budget arms you with proof that shows exactly how much you can pay and why, and is a must-have before talking to creditors. See our previous post for tips! 

And don't forget to adopt the goal Draw up a budget, as well as check out lovemoney.com's brand new online banking service - both of which will help you budget.

CCCS's freephone helpline (0800 138 1111) is open 8am to 8pm Monday to Friday, while Debt Remedy online counselling is available twenty-four hours a day, seven days a week. 

Get help from lovemoney.com: Destroy your debts

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