I checked this out myself this morning, as I’d thought about offering some advice, but wasn’t entirely sure of my facts.  What I was sure about was that checking that all the details held on you are actually correct and that other people’s personal debts aren’t on your file. Being on the electoral register at your address is also important and you need to keep yourself in check when it comes to applying for credit – do it too frequently and you’ll be viewed in a dim light.

There are also some good tips to pick up on, if you’re in a position to do it. If you can, borrow and pay back what you borrow, clearing the balance each month.  If you can do this over a series of months, this will look good on your credit record and improve your rating.  Close down any accounts that you don’t use and be canny about doing the things that lenders like, such as living in one place for a long time, having a land line rather than just a mobile and stay with the same bank over a decent period of time.

Paying the minimum payments on your personal debts on time is really important and if you miss a payment, make sure you catch up. I’m always telling my mates that, but they all seem to have this, ‘whatever’ attitude to missed and late payments. It really does matter, even if they take it all so lightly!  Similarly, don’t bust your overdraft limit.

If you are refused credit, the lender must say why, so that you can review your information and correct things with which you disagree. If you have paid off a debt on a County Court judgement, make sure this has been noted on your file.

It will cost you just £2 to get hold of a copy of your credit rating, but add another tenner to that and you can get a full list of your credit agreements and the data held on them.  It might make uncomfortable reading, but to move forward, you have to review the past, take note of the mistakes and start to put things right.

What our your tips to improve your credit rating? Let us know in the comments.

One of the top ten answers to this question at present is probably petrol – the spiralling cost of it, the bigger percentage it now takes up of your weekly or monthly wage and the amount you are now paying for on your credit card, rather than in cash. Ringing true? Well you’re not alone.

The country’s petrol bill has gone up by over 40% in the last five years, even though the amount of fuel going into the tank has fallen by 5.3%, according to recent figures from the Office For National Statistics. Cutbacks have been made in areas such as day trips, but many of us simply have to have fuel to get to work, get the children to school and get in our weekly food shop.  That’s why big personal debts are now being built up on credit cards thanks to petrol.

In a recent Moneyextra Facebook poll, we found that 25% of people with personal debts say that their debt derives from rising fuel costs.  Only the rising cost of food and unemployment ranked higher.  Driving less was seen as a major way to reduce spending. But worryingly, a quarter of those that Moneyextra asked said that they were paying for petrol on their credit card.  If that’s the case, a monthly spend on petrol will soon rack up the total personal debt on a card, causing a major problem in the long term.

If your purchases of petrol on your credit card have got way out of hand and the money that you thought you could bring in to deal with them just hasn’t materialised, you need to keep action fast, rather than just carrying on using the plastic.  You will soon reach your credit limit and, if you do, what are you then going to do to keep yourself on the road?

If petrol on plastic is your current purchase method for fuel, it should tell you that you’ve an imbalance between your income and your expenditure and you just can’t manage your financial commitments.  You need to talk to a debt counsellor, who can go through your expenditure with you and suggest how you might make savings, or be able to reduce the amounts that you need to pay back to your creditors, if you have personal debts on credit cards and loans. 
Going through this process, even if you do not then need to look at a Debt Management Plan (DMP) or an Individual Voluntary Arrangement (IVA), can help you make savings in certain areas, which can help you put more towards petrol.

Don’t allow the cost of petrol to bring you down financially.  Take action, take stock of the hole in your income that fuel is creating and talk about the ‘tank’ and the impact it’s having on your finances.  If not, you could be driving towards disaster.

Whilst this is all about orange juice that makes your eyes pop with its freshness and a really good smack from a few rashers of bacon, I like the whole ethos of this theme and think it’s got a role within the world of personal debt.

Getting to grips with personal debt is all about facing up to reality and that’s what many people fail to do until it’s too late. If you take action in time, you can save yourself facing the humiliation and stigma that’s attached to Bankruptcy and, let’s face it, however much we tell ourselves that life has changed and people won’t whisper about us behind our backs, we’re pretty much fooling ourselves on that one. We live in a society that loves a good gossip and bankruptcy is one big topic to prattle about when the victim of our conversation is out of sight.

Shaking up your wake up means doing something about your personal debts once you’ve realised that you’re in too deep. Admitting to yourself that you can’t cope with it is just step one. Shaking up things by taking positive action to get rid of it is the next important step.

The minute you’ve shaken yourself into action, and have contacted those who you owe to have the conversation that say that you can’t cope, you will be given a 30-day breather. This gives you time to get in contact with a debt adviser and form some sort of plan of what you are going to do to repay what you can afford. This could be a Debt Management Plan, or maybe an Individual Voluntary Arrangement (IVA), depending on how much you owe, what assets you have and how fast you want to get out of your debt nightmare. Hopefully, your only resort won’t be Bankruptcy, if you woke up to your personal debt situation fast enough.

If you’re a sunny-side-up kind of eggs-in-the-morning person, you might need some good positive reasons to shake up your wake up. That could be the future promise of a life free of debt, or one free from the stress of calls from your creditors. It might be the relief of not having to lie to your loved ones any more, or hide bills the moment they arrive on the mat. It might mean calm and peaceful nights full of restful sleep, rather than spending the night staring at the ceiling worrying about your bills and how you are going to meet the cost of your debt repayments.

Whatever would make you get up and be happy in the morning is what you should focus on if you want to shake up your debt wake up. Farmhouse Breakfast Week falls at a perfect time of year to do that, when your personal debts are probably at their highest after Christmas spending and your income at its most stretched.

Get cracking on your debt egg today and find some soldiers who will be your debt advisers fighting your case. Life can sizzle again, if you take positive action and get off following the signpost that says ‘Debt Freedom This Way’!

By this point, if you’re like me, you’ve already had all the credit card bills that you knocked up leading up to Christmas and in the sales, you’ve run out of cash in your bank account with all of your December pay packet being spent ages ago and all that Christmas glow has evaporated in the harsh reality of January. No wonder they call it Blue Monday!

But for some, Blue Monday is every Monday – all 52 of them in a year.  It’s also every other day of the week, because debt has engulfed all life and taken away every single joy that comes from living it. It’s one long nightmare of sleepless nights, hours spent awake worrying about how to pay bills and get creditors off the phone, guilt at the fact that personal debts built up in the first place and a helpless feeling of being out of control.

Accompanying this is an embarrassment and an inability to talk to anyone about worries and a sinking gloomy mood that constantly places a voice in the head that says “things will never get any better”.

If this sounds too familiar and your life is one long string of Blue Mondays, you need to do something about it. I was browsing the web and found that the Royal College of Psychiatrists advises people not to ignore their personal debts, as they will only get worse.  They say that one in two adults with debts has a mental health problem – this most likely being depression, I guess.  Their leaflet Debt and Mental Health advises people suffering thanks to personal debt to speak to a debt adviser and get expert advice, deciding whether you just need to unburden yourself, by speaking to a debt adviser who is non-judgmental and who can offer you solutions, or whether you also need one who will take over the responsibility of dealing with your creditors, removing all that stress and strain from your shoulders.

They advise that, if you have suffered a mental health problem, you try to explain this to your creditors, ideally through a debt adviser who can explain the impact that this might have had on your personal debt situation.  If this doesn’t happen, the spending sprees and mania that often accompanies depression and poor mental health can be viewed as simply fraudulent behaviour.

Interestingly enough, they also say that you need to consider whether you can afford to wait to see a debt adviser, given your state of mental health, or whether you need to remove yourself of the stress of waiting for an appointment, queuing at an advice centre and then waiting for action to be taken on your behalf. Many people do decide that hanging around and delaying decisive debt repayment action even longer just isn’t worth the additional strain.

All of the commentators on the link between debt and depression urge swift action, explaining that as soon as you unburden yourself of the guilt, the secrets that accompany personal debt, the truth about your financial situation and the implications for your family, the sooner you will start to feel better. 

Getting debt management advice can immediately remove the debt yoke from the neck, even if the process of unburdening results in a few tears.  Debt advisers who deal with personal debts every day of the week are used to this, so you are not alone in your emotions. 

The important thing to recognise is that depression can wreck a life more than personal debt and there is a way forward with the latter.  Find that and you will have the key that will unlock a happy life once more.  Pick up the phone and get some debt advice today and you might just start to see some of that light at the end of the debt tunnel.

The team they will be playing for is that comprising folk in personal debt, in deep distress over the results of the last few months and truly upset about decisions made by ‘referees’ working for their creditors – officials who by now have probably given them more than a few financial yellow cards, in terms of charges for late and missed payments, going over their credit limit and maybe bouncing cheques and who are now threatening red cards that will see them facing much sterner penalties.

Our debt advisers are the coaches of these personal debt players, who are trying to out-manoeuvre the opposition, but just coming up against a stalwart defence comprising the financial rules governing their credit cards, personal loans and other debts.

Debt Free Direct’s debt counsellors are also the physios, as they help restore the mental balance of people turning to them for help once they have realised the extent of their financial injuries.  Debt advisers can take away the stress, help promote better sleep and restore peace of mind to those who’ve had agents incessantly banging on the door wanting answers, payments and goods.

Above all, the debt advice team are managers, taking control of situations, seeing what the opposition expect of their debtors and coming up with a strategy to keep both sides happy.  They take on board the ability of their players, in terms of what they can afford to pay to their creditors, and then take control of the game by presenting a financial proposition to those creditors.  If both sides agree, which they often do, the final whistle is called on all the debt stress that has been bringing debtors down for months and possibly years.  A bright new chance to start climbing up the financial table again is suddenly presented and a much lower level of transfer money is paid over to the creditors.

As I said, the debt advice team know that the phones will soon be red hot with requests for debt help and debt solutions.  The January window is pretty much open and the Christmas euphoria has mostly slipped away.  While debt charities may struggle to cope with the demands of the debt fixtures at this time of the year, with diaries full and advisers in short supply, the Debt Free Direct team will be able to tackle issues instantly and start achieving some goals for those in distressing debt situations.  Pass the ball on today and tomorrow could become a whole new ball game for you and your family.

If you fancy playing your way out of debt and getting on the offensive, rather than the defensive, when it comes to facing up to your personal debts and your ‘opposition’, get in touch with a Debt Free Direct debt adviser and at least have a team talk that will give you some options to mull over. Whether you then proceed as advised is entirely down to you.  After all, you’re the one on the pitch and only you can decide whether you want to get things clear with help, go it alone, or carry on scoring financial own goals.

He finds it hilarious and started reading me the story of the Three Little Pigs, but with a different financial take on the traditional tale. Basically, in this story, it was the bailiff playing the part of the wolf and trying to blow the house down of each little pig in turn.

Two of the little pigs fell by the wayside, caught out by tempting deals on purchases that got them into a true financial mess.  The third little pig pretty much did the same, but then had to continuously develop strategies to outwit the bailiff and prevent him from entering the house to seize goods.

This is where it all really struck home for me, because it truly portrayed the situation that many people in personal debt are facing, even as I write.  There’s nothing more distressing than having to sit at the window, checking whether a debt collector of bailiff is heading towards the door.  It’s soul-destroying to leave your family members to deal with this type of knock at the door when you are not at home.  It’s a recipe for sleepless nights, high stress levels, poor health and broken relationships.

Dodging the bailiff, as the little pig did, can only work for so long and really isn’t the answer.  You cannot escape your financial commitments and sooner or later will be caught out by those chasing you.  Life isn’t worth living if it’s a case of cat and mouse each and every day – or pig and wolf for that matter.

One of the biggest benefits that those who sort out their personal debts feel, from the moment they take the plunge and get debt advice, is that of knowing that there will not be an enemy at the door any longer and that, by making an arrangement to pay off their debts, which meets with the approval of their creditors, the phone calls demanding money will end, the red demands will not be dropping through the letter-box and the rap on the door may be the postman, but will not be a debt collector.

Ask yourself if you want to live a pig of a lifestyle, or sort out your personal debts once and for all and start moving forwards, rather than backwards. Don’t let anyone blow your house down, when some simple, yet decisive, debt management action could save the day.  Life isn’t a fairy-tale, but it can have much more value, if you no longer have to hide from those you owe.

Apparently there was a near-record deterioration of household finances in December and things are expected to worsen, rather than getting better any time soon.  Reports say that many households are downbeat about their financial prospects in 2012, which pretty much means that many people are on a financial knife-edge and could topple at any moment.

My mate Tom is a classic example of someone foolishly thinking that their bank balance is half-full, rather than half-empty.  I know he has massive personal debts, am pretty sure he stuck to no kind of budget for Christmas spending and know that the money he does currently have at the bank is all promised elsewhere.  Despite this, he won’t put his house in order and just refuses to accept that he needs to speak to a debt adviser.

He seems to have a natural aversion to figures and just can’t bring himself to list his outgoings and earnings, which is the starting point for getting everything back into balance.  He is truly living an unaffordable lifestyle and it’s catching up with him fast.  As I keep telling him, by picking up the phone and speaking to a debt adviser, someone else can crunch the numbers for him and work out what he can and cannot afford. 

All he needs to do is make time for self help by making a list of his direct debits, Council Tax, energy costs and so on.  As I’ve told him, if he doesn’t pay his way and gets a CCJ against his name, he’ll be making this list to tell the Court what he can afford to pay to debtors!

If you’re reading this and staring at the bulging carrier bags that you’ve brought back from the sales, knowing you couldn’t afford to buy these things, tell yourself that this was your last blaze of glory before sorting out your personal debts in 2012. 

Don’t keep piling up the baggage when what you really need to invest in is some debt counselling and debt advice that will tell you whether you need a debt management plan, an IVA, or a more drastic response to your financial position. 

Picking up the phone now you’ve hit the sales could give you a better night’s sleep and a more positive outlook on 2012 into the bargain!

That was then and this is now!  I was walking round the supermarket the other day and I heard a mother tell her daughter that they had to start buying for Christmas now, because there were only another two pay days before Christmas Day.  The whole ‘get-the-baubles-out-early’ thing then took on a new significance for me and I realised that, although the stores’ policy on this has absolutely nothing to do with personal debt, all of the people in debt, or on the precipice and about to tumble into a world of personal debt, need to be those disregarding the ‘magical December’ idyll.

Mid January is a nightmare for very many people, as that’s when the credit and store card bills detailing all of the Christmas spending land on the mat.  There’s even a day called Blue Monday – the third Monday after New Year, that is supposed to be the most depressing day of the year (scientifically calculated) and personal debt is part of the equation that determines this.

Spreading the load of Christmas spending across several months makes much more sense.  It can make the repayment more manageable, avoid a huge shock in January – and potentially a massive debt repayment issue – and also potentially flag up where shortfalls in income might lie, well before December comes along.

Early Christmas shopping is also very much about budgeting and our debt advisers and debt counsellors here are always keen to teach those with personal debts the importance of budgeting.  Working out where cuts can be made is part of their job and you can ring for advice on where to get better deals, as that can really make a big difference to your balance sheet.

Of course, if you do have big personal debt issues, the sensible thing to do is to start a conversation now, explaining to friends and family that you are having to cut back on presents this year and would feel embarrassed if they bought you anything, when you can’t buy for them.  You can couch this in really sensible terms, explaining that it makes no sense to be wasting money on presents – particularly for adults – when there’s so much job insecurity, when nobody knows what’s around the corner and when saving and not spending is the way to go.

Doing this now, means that you can hopefully prevent others buying presents and not feel forced to do the same.  While it may sound like Scrooge-like behaviour, you might actually find that your words of wisdom come as a blessed relief to other friends and family also secretly struggling with personal debts and worrying about what the impact of that nasty January bill might do to them.

If all of this advice rings far too true and you still haven’t managed to cope with the impact of last January’s credit and store card bills, you really do need some debt advice.  Make a call to our debt counsellors and discuss your options, whether these be a debt management plan or an IVA, that will see you tackling your debts and move you back towards what you’re probably longing for one day – a Black Christmas!

It was clear that the energy company hadn’t calculated the premium correctly when they set the direct debit amount – maybe that was their way of pretending to save me money, who knows!  The biggest shock, however, was that they said they were now going to hike my direct debit premium from £61 a month to £180 a month!

Now I know that energy prices have risen, but a trebling in my bill left me incredulous.  When I worked out my consumption figures for the last year, I found that I’d actually been using £45 of gas and £25 of electricity a month.  In other words, what I was paying previously was pretty much spot on.  What this energy provider was doing, however, was moving me to a “new plan” – one that was charging a vastly increased amount per unit, for both gas and electricity, hence the hike in monthly payment.

I’m sharing this with you, because it demonstrates how you can save yourself a fortune, if you read the small print.  The “new plan” was going to charge me around 24p per unit for electricity and around 8p per unit for gas.  This then fell slightly after a certain number of units were used, but not enough!  I picked up the phone, rang my last supplier – again the cheapest in the market – and have moved to a rate that will charge me 13.2p per unit for electricity and 4.3p per unit for gas.  I will be paying £70.54 a month, rather than £152 a month, had I cleared the debit of £287 and then paid another fixed amount per month.  In other words, I’ve slashed my future bills by half.

Everyone should be shopping around in these situations, but for those in personal debt, it’s even more important.  When every penny counts, you need to save them and energy is one area in which you really can make some savings, if you are with an uncompetitive supplier.  Debt advisers at Debt Free Direct can help you do this, if you need to speak to a debt counsellor and get debt advice about all sorts of things within your personal finances, but you can also do what I did and take action, to prevent personal debts building up.

Debt advisers tell us that energy is a massive concern for many people in our society these days, from the elderly, to families struggling to keep their heads above water.  If your income has been cut, due to reductions in overtime or redundancy, slashing bills is vital, so don’t delay or you will be paying out unnecessarily.  If you are in some sort of contract that prevents you moving for a while, check out penalty clauses, because it may still be financially worth your while to switch provider and pay the penalty. If you absolutely can’t switch yet, note the date on which you can in your calendar and make sure you move as fast as you can.

I’m pretty chuffed with my £80-a-month saving and I’m sure that anyone struggling to pay bills, make debt payments and in serious need of debt advice would feel exactly the same.

Dig your energy bills out, look at the small print and make the move by calling our money savings team on 0844 826 2537. From a mobile it may be cheaper to call 01257 486961. On average we save our customers £150 on their household bills. Call us to see how much you can save!

P is the Porch
This is where you might suddenly find a doorstep lender turning up to offer you a dream amount of cash, which you could probably badly use to make personal debt repayments, or just use for essential purposes. It might appear to you that you’re borrowing from Peter to pay Paul, if you have a heap of personal debts, but you might not think much beyond that and it might seem a good idea at the time.
On that basis, here’s a figure to shock you out of action when it comes to these guys. One woman borrowed £500, which resulted in a total payment back to the loan shark of £90,000 over 7 years. These lenders are termed ‘sharks’ for a reason. Don’t let their illegal antics get their teeth into you!

Remember also that if you find it upsetting enough dealing with lenders on the phone, that’s going to be nothing compared to what the sharks can get up to, with intimidation and threats being commonplace. Rather than opting for Peter in the porch, pick up the phone and speak to a debt counsellor who can immediately start to help you sort out your personal debt situation, without borrowing more money!

P is Pay Weekly
This is buying something – often for the home – which you then pay for over the course of many weeks. This tip’s all about common sense and thinking about finances in the longer term. Past generations saved to buy thing, rather than using credit, for a reason.  By doing so, they avoided the dreaded APR that applies to Pay Weekly schemes, storecards and so much more.

The rate of APR can make the total cost of your purchase substantially higher than it would be if you purchased it outright for cash. You could end up paying 3-4 times the value of the purchase, when you maybe have saved up for it, at cost, in 4 or 5 months.  To avoid personal debts building up on purchases like this, get into the saving habit and make it your mission to cut APRs out of your life as much as possible.  It’s worth it, if you take a long-term view of your finances.

P is a Pawn of Pawn Broker
Finally, don’t become a pawn of the pawn broker.  They will also charge a hefty rate of interest on your pawned items and some beloved items could leave your life forever, if you can’t then pay back the loan and the interest on what you’ve pawned. You’ll also only be given a fraction of what your jewellery is worth, so instead of pawning a necklace, give a debt adviser a ring!

Be aware and be canny.  It’s better to explain, ask someone for a bit more patience and get the money together free of that interest. If you find such a conversation impossible to have with your creditors, bring in a debt adviser who is expert in this field. If you start to work through a debt management plan or an IVA to reduce your debts, you will be relieved of having conversations with creditors, the phone will stop ringing and you won’t have to resort to desperate tactics like payday loans to get you out of your financial and personal debt mess.