As the New Year gets underway, getting on track with personal finances can be a resolution many make. However, with a typical household spending more than £800 extra in December, according to the Bank of England, spending around the Christmas period can often make January a more difficult month. However, advice on money management and paying off debt is available.
Last year, a call about debt was expected every four minutes throughout January at the Money and Pensions Service (MaPS).
In a bid to help members of the public, helplines for people with money worries are gearing up for one of the busiest times of the year.
In January 2018, almost 3,500 debt calls were made to the free Money Advice Service (MAS) helpline, while there were 26,000 visits to the MAS debt advice locator – a tool that connects people with the most convenient debt advice providers in their area and over the phone or online.
The MaPS says that this year is expected to follow the trend, with demand for debt support on the increase.
Caroline Siarkiewicz, Acting Chief Executive of the Money and Pensions Service said: “We know what a difficult time of year this can be for families who are worried about the bills piling up.
“It can be tempting to avoid confronting money worries after an expensive Christmas but the sooner you act, the easier it will be.
“Debt advice works. You can speak to the Money Advice Service for free, confidential help, connecting you with expert debt advice in your area.”
Today there are nine million adults in the UK who are over-indebted.
This means that nine million people find meeting monthly payments to be a heavy burden or are regularly behind on their bills.
But, despite so many people being over-indebted, figures show only a third of over-indebted people are getting help with debt.
Getting free and confidential debt advice is the first step to getting your finances back on track, the Money and Pensions Service says, with data showing nearly two-thirds (64 percent) of people with outstanding payments have reduced or cleared their debts within three to six months of seeking advice.
After getting debt advice, seven in ten people also report feeling less worried and less stressed about money.
And, the research suggests that the majority of people (59 percent) feel their situation is better, three to six months after their debt adviser closed their case.
MaPS offer the following top tips for tackling your money worries:
Open up to someone
Although it can be difficult, talking about money worries is often the first step towards getting help. Research has shown that people who talk about their finances feel less stressed or anxious and more in control.
Work out your debts
Write down everything that you owe. This might seem overwhelming but facing up to what you owe will help in the long run.
Pay off debts in the right order
Make sure to pay debts such as mortgage, rent and energy payments before secondary debts like overdrafts, personal loans and credit cards.
Set a budget
A good way to understand how much you can afford to pay back each month is to write down what your income is and list all your expenditure. The budget planner on the Money Advice Service website can help you calculate this.
Seek professional help if you are struggling with debt
You can use the debt advice locator tool to find a free debt adviser in your local area. You can also sign up to the New Year’s Money Check-Up Challenge to get regular money tips and reminders throughout January.