Despite all the doom and gloom in the press at the moment, there is something for me to smile about – I have recently come out of debt, and thought I’d share my experience with everyone, so hopefully people don’t end up in the same mess as I did!

When I was in debt, I decided to get some professional advice. I was told that if I wanted my situation to change, I needed to improve my debt management skills. So I looked into the ways in which I could do this and put three ideas into practice. A couple of years later and here I am…debt free.

Speak to a professional debt adviser

This was the first thing I did. The debt adviser assessed my situation, talked me through my possible options and advised me on what I should do – which, as mentioned, was improve my debt management skills.

Understand your priorities

The very first thing I had to get to grips with was understanding my priorities. I had to figure out which of my monthly debt repayments was most important. I found that the easiest way for me to do this was to sit down and take a look at which debts would carry the most severe consequences if I failed to keep up with repayments to them. I was told that these debts are my ‘priority debts’ (my mortgage and other secured debts).

My other debts (unsecured loans, credit/store cards, for example) are my ‘non-priority debts’.

The debt adviser told me the most important thing was to make sure I could afford payments to my secured debts – because if I failed to repay these, my home could be repossessed, for example.

Draw up a budget

The next step I took was to draw up a budget. This, the debt adviser said, would be an excellent way of improving my debt management skills. It helped me monitor my finances closely and helped me see where I could make cut-backs on ‘non-essential’ spending to free up money I should have been putting towards my debts.

Guest Post from Aaron Christie.

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