March 24, 2006

By Peter Kenny

If you’ve ever been over your head in debt, you will be well aware of how much stress and turmoil it can cause. Recent surveys have shown that along with relationship problems, debt is one of the most stressful problems facing people. And now, with the explosion of the consumer debt mountain, there are few things that cause as much stress on a day-to-day basis.

Every day in the UK, consumers in the form of credit card and store card transactions are borrowing millions of pounds. These debts are typically high interest charging and very flexible, which makes it easy for the balance to be reduced as well as to grow, but the definite trend in the market is for the debt level to be steadily increasing.

That is why it is becoming more and more common, and also it is becoming easier, for credit card debts to simply get a little out of hand. There are a number of strategies you should take however for getting these debts back under control.

Take Control

The first step is to stop using the cards. If this is not possible, then at least cut back on credit card usage. You will only ever be able to reduce the balance if you stop adding to it. Otherwise, no matter how much you allocate to paying it back each month, you will never make a dent on the total.

Pay Off The Most Expensive First

Another thing you should consider is, if you have a number of, each with different interest rates, and then you should concentrate on repaying the highest interest cards off first. This might mean reducing the amount you pay back each month on the other cards to the minimum payment so that you will be able to clear off the most expensive card fastest.

Cancel Your Payment Protection Insurance

If you are paying for option extras such as payment protection insurance, then maybe you will wish to consider cancelling this option, as it will be again taking more money away from repaying the card, and instead, spending it on a service that you may or may not want. Of course, payment protection insurance is a genuine insurance that offers you protection against the possibility that you will become unable to meet all of your repayment obligations, but if you do think that you can get by without payment protection insurance, then this is probably one expense that you should remove from your credit card.