How to generate sufficient income to pay the increase in taxes and the reduction in benefits which is definitely on its way.



How to service our own debt.

Working as a consultant for a debt advice charity in the UK, it has become glaringly obvious that we are heading into a debt epidemic. The whole nation is drowning in debt. There are going to be more personal bankruptcies and Individual voluntary arrangements during the next 12 months than we have ever witnessed in our lifetime. This of course added to the business bankruptcies which are inevitable, causing further redundancies and more personal debt problems and the cost is incalculable. There is no way a recovery is coming in the foreseeable future.

The only people who are safe are the civil servants. The worse it gets for the rest of us the better it is for the army of bureaucrats. However even they will have to dig deep with the increased tax levels.

Those of you in safe occupations like essential services and teaching should be okay but even you will face a more expensive future. There will be few pay rises and make the most of the low interest rates because it won't last long.

The commentators really make me laugh. When things are really good they predict doom and gloom and when things are dire, they see "The green shoots of recovery" Ignore them all and try to protect what you have.

If you are having difficulty servicing your debt there are some steps you must take to safeguard you and your family.

1. Pay the most important things first. This may sound obvious but you would be amazed at the way people manage their finances. Mortgage/Rent is priority number one. (You must keep the roof over your head).

2. Secured loans (any debt secured against your property)

3. Local rates/Council tax (depending where in the world you are)

4. Government taxes IE income tax VAT etc. (not paying these can send you to prison)

5. Utilities (gas, electricity, water)

6. TV license (UK)

7. Leave unsecured debt until last, no matter what the creditors chasing you may say. This includes all credit and store cards and personal loans which are not secured on your property.

8. If you have mortgage arrears do speak to your lender immediately. In today's climate they really will try and help with a solution but you must inform them at the first sign of a problem.

9. Maximize your income. Again it seems obvious but have you explored all possibilities of generating some extra cash (honestly of course).

10. If things look bleak I really do advise talking to a debt advice charity in your local area. Stay away from the commercial operators advertised everywhere. Many charge very high fees.

11. Look in your phone book or on-line but make sure they are a registered charity and check them out.

12. If you feel confident in handling your situation personally, there are some good guides available. Again choose wisely.

I sincerely hope everything turns out well for you. We will come through these dark days we won't be drowning in debt forever but it may take longer than many believe.