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Not so long ago, ‘debt’ would have been a dirty word for many people. The financial crisis in Britain presently has led to people speaking about it candidly. Many will use an IVA to help extricate themselves from debt.

Debt has long been regarded as a taboo subject and people were decidedly reticent to talk about it. The current financial climate, however, has led to record numbers experiencing debt problems of one form or another. As a result of this, it is no longer considered controversial to discuss our debt problems with our friends and family. Debt management can be a particularly difficult due to spiralling living costs but many are beginning to see an IVA (individual voluntary arrangement) as a viable means of tackling financial arrears. Debt management in the UK is becoming increasingly difficult and the Citizen Advice Bureau views the current situation as ‘worrying’. Many in debt will use an individual voluntary arrangement with licensed insolvency practitioners to tackle their debt arrears.

Why are We in Debt?

There are a number of contributory factors to the current financial crisis that grips the nation. From the credit crunch to spiralling living cost, all are having a profound impact upon consumer’s finances and financial experts predict that insolvencies will hit record levels. One of the primary reasons that debt management is proving so tricky for many consumers across the UK is spiralling living costs. Energy bills, cost of food, petrol prices and all sorts of price hikes are hitting consumers in the wallet and those threatened with insolvency or bankruptcy are turning to an individual voluntary arrangement to help them out of their financial hole. Teresa Perchard of the Citizen Advice Bureau stated, “These latest figures paint a worrying picture, suggesting a significant number of households are struggling to meet their most basic living costs.”

IVA – A problem shared

Part of the problem with debt is the loneliness that is associated with it but many are finding that the increasingly accepting attitude surrounding debt is making it easier to get their finances back on track. Many financial experts believe that, when it comes to debt management, an IVA is an excellent means of tackling debt problems head on. An IVA is a legally binding contract between creditors and those in debt and it allows them to pay back their outstanding arrears at a level that is financially feasible for them. Research conducted by Alliance & Leicester found that people are now more likely to talk about debt issues than they are about sport or celebrities.

IVA – Growing debt concerns

The primary reason that people are seemingly more amenable to discussing debt is the fact that money matters and financial concerns are on the mind of the majority of consumers in the UK. Ewan Edwards of Alliance & Leicester states, “Our survey reveals money matters have a firm place at the forefront of people’s minds at the moment.” With insolvency set to reach record levels, many consumers who are swamped in debt are looking for a financial solution to appease their creditors and increasing numbers are opting for an IVA in order to do this.

It might seem counterintuitive to some, but having a few credit cards in your wallet to be used in a smart manner is an excellent way to improve your credit score. As you know, having a high credit score is one of the keys to a financially successful life, if your score is mediocre to low then you will have a harder time acquiring loans, and the payments that you will make will pretty much always cost you more in the long run.

Millions upon millions of people get trapped by credit card debt every year, simply because they do not use the cards in a fiscally responsible way, and this not only causes a large debt, but it also can have quite a few personal implications as well.

The first way a credit card can help is that it shows a credit history. Always try not to cancel any credit cards because you have decided not to use them anymore, a long credit history, even for a card that has little use is far better than one that is only a few months or a year along because you decided to close all your old cards from five years ago. Anything that is new will show up with an inquiry on your credit report, which will bring your score down a bit for at least a few months and maybe up to a year, so try to hang on to as many older cards as you can.
If you do have some of these old credit cards, focus on using them every few months to buy something, for example fill up your tank with petrol using one of these cards every 2-3 months. This way the card appears to be active on your credit history, but it will not cause you any sort of undue burden to pay off when the bill comes due.

Another way you can use a credit card to your advantage is to ask for higher limits. Especially on those cards that are older. Higher unused limits will always help increase your score, especially if you keep your credit card debt at or below about 35% of the limit amount. It also shows that the credit card company has found you to be a trustworthy customer who is capable of paying bills and not racking up large amounts of debt.

The most important thing, however, is to always pay your bill on time. The very best option is to pay your bill in full and on time, but at the very least always aim to pay above the minimum balance and before it’s due. Nothing will be able to improve your credit score if you have consistently late payments each month; that will actually hurt your chances of getting any sorts of loans or other credit cards in the future.

Having a difficult time paying off your student debt while in college? Let’s face it, paying off debts while you’re still studying is not that easy. For one, you have no regular source of income. But then again, there are still other options available.

Just remember that when you have an existing student loan, the interest would accumulate through years if you are unable to pay them off on time. This would further increase your financial burden so as much as possible, you have to pay off your debts on time or even earlier.

Here are some tips on how to pay off your college student debt:

1. Save money. First, you really have to save money in order to pay for your loan. For instance, you can save at least ten percent of your weekly allowance or income so that by the end of the year, you have enough money to pay off a portion of your student loan. Try to find means on how to stretch your money. Avoid spending on things you don’t really need such as brand new clothes and skip eating in expensive restaurants or fast food chains. Be practical when it comes to money.

2. Find a part time job. You can also look for a part time job while studying so you can save money to pay off your debt. There are jobs you can try online such as freelance writing, pay per click advertising, blogging, online tutorials, and more. You can start doing work from home so you can save on time and travel expenses. You can also apply as a student assistant in your university. Some universities would give discounted tuition fees and monthly allowance for student assistants.

3. Pay quarterly interest for your student loan. If for instance, you use unsubsidized loan, you can pay the interest every quarter. This will enable you to minimize the amount of interest which you will pay when you graduate. It’s like saving your money for the future. In subsidized loans, the loan would start to accumulate interest especially if it takes longer for you to finish college. Paying the quarterly interest allows you to pay the interest on the original loan amount, which in turn, helps you save money.

4. Look for other sources of income. You can also pay off your student debt by looking for other sources of income. If you can’t get a part time job for example, you can opt to conduct garage sales or other income-generating projects to help you earn money.

These are just some of the things you can do to pay off your student debt. If you are able to pay off your debt as early as possible, it will be to your advantage.

Unemployment is not an uncommon thing today. A lot of people become find it hard to find one because they are either over-qualified or the job is a little too down for them. But did you know that you can now make money online? There are a lot of jobs online that will only require you to stay at home, it is called freelancing. Freelancing jobs can be a source of extra income for some. People do it to save money for paying the bills, the rent, and the works. Freelancing is considered a legit job, so you still have to do a credit check regularly but then again, this can also improve your credit score. Follow these tips to balance earning money and maintaining your credit.

• You are going to need to pay your bills at every end of the month. If you get to work as a freelancing designer, writer, consultant or editor consistently, then this job can help you with pay for it and not miss out on payments. Missing on payments will hurt your credit score and it may affect your credit report that clients usually look for. This is what they will use to find out if you are trustworthy and responsible so taking care of it is a priority.

• Another way to earn money online is by blogging. Companies or people can pay you to put up their advertisements on your site. You can also get paid for sharing opinions and some product reviews. Posting valid survey tests on your site for others to answer will also help you earn money. You can choose to work part time or full time, but of course, the more time you spend with freelancing, the more money you will earn.

• Some people get their salary only once a month, which can make budgeting a tad more difficult. Clients sometimes even miss out on that date and you have to wait for next month’s payday. Your bills, however can’t afford to wait that long, unless you want to jeopardize your credit score. Managing your money and earning online can prevent you from missing out on your bills. You just have to manage your money wisely and set your priorities first.

•  Do a credit regularly to keep track of your report and to make sure that everything is in good shape. Some employers do a credit check without you knowing, and good credit report may land you the job or not. If you do a good job, your employer might even recommend you to others.

Your credit and your job will always be as one. There may be a lot of ways to earn money, but remember that making money will not be easy but if you can manage it well then you’ll be able to pay your bills, keep your credit healthy and keep a consistent job. Managing debt is a key to high credit score which can make your financial life better as credit score is a pass that makes you look good by the lenders and the banks.

Jack is a financial blogger and love to share financial tips to manage personal finances, improve credit score and monitor credit report free.

Renting

In the current climate, most people are struggling to get on the property ladder and renting is becoming increasingly popular. But how can you find out about paying a lower amount and save money on your biggest monthly outlay? Perhaps you are under the impression that your monthly rent payment is set in stone and the only way to pay less is to move to a cheaper rental. It may surprise you, but this isn’t necessarily the case.

Communicate with your landlord.

If you are struggling financially, speak to your landlord. Landlords don’t want the hassle of looking for new tenants and chasing late payments with the chance of receiving nothing if their tenant can no longer afford their rates.

Your landlord is human and in all likelihood, will understand if you fall on hard times. You could try asking for a decrease in rent in exchange for signing a longer term’s lease – this keeps the landlord happy, as they don’t want the expense of hiring an estate agent to look for a new tenant.

When it comes time to renew your lease, don’t be too quick to agree to any increase in rent. A good, reliable tenant is a godsend to a landlord, and they may be more willing than you think to negotiate. All you need to do is ask – you will be surprised how accommodating landlords can be if they think you are saving them time and hassle.

For those living in a complex and who enjoy DIY type work, there may be the option to assist the property owner in carrying out various tasks around the complex in order for a reduction in rent. As well as simple DIY tasks, you could carry out gardening tasks or clean windows.

Check trends.

Everything is negotiable and it pays to keep up with market trends. Speak to neighbours to find out what they’re paying, and even speak to your local tenants Have facts ready before speaking to your landlord to show that you know your stuff and have done your homework.

Highlight the benefits of having you as a tenant:

• always pay your rent on time

• intend to stay there for a long time

• keep the place clean and tidy, and

• don’t give the landlord any other hassles, etc.

Showing yourself in the best possible light with confidence will go a long way in any negotiations with your landlord.

Get a roommate.

Think of the amount of money you could potentially save if you rented out a spare room. This is the best way to gain a massive rent reduction. Always check with your landlord that this is alright. Most will have no problem with it. Renting to someone you know is always preferred. If you do not have that luxury, then make sure you screen any potential lodgers thoroughly, and ask for references in order to avoid problems later on.

Consider rent subsidy.

You may be entitled to assistance from the government if you are on a low income and should make enquiries through your local housing office. You could be entitled to some form of housing benefit and it won’t hurt to ask.