Saturday, 12 March 2016

Managing Debt

Generally speaking being a parent you can have a loss of income, either you drop to part time hours or spend more on childcare.  If your lucky you might be able to change to working from home with the flexibility it affords to be there for the school drop off and pick up, holidays or when your child is off sick.

We have had a few moments of financial crisis; my hubbie for a while had part-time hours after a colleague returned from maternity leave he was covering.  Luckily we could call on my parents for help, they would give us meals or kindly let me pinch a few cupboard staples.  They borrowed us money until we got on our feet.  Not everyone has parents that are in a position to help and then you need to look at other options.  Writing a spreadsheet with all your incomings and outgoings can focus you, seeing if you can make any cutbacks to better manage your finances.  Get rid of luxuries you can live without freeing up more money for the necessities.  If your not familiar with Excel just go back to basics with paper and a calculator but whatever you do don't have your head in the sand, face the problem head on and work at resolving it!

If your in a bit of a financial mess you might not have a good enough credit score to get finance, then considering guarantor loans might be one feasible way to get your hands on extra funds.  If you have someone willing to vouch for you and take on the debt if for some reason you can no longer do so.  I do think this should be a short term solution to consolidate higher rate debt, possibly whilst you weather the storm then cut back your spending, see if you have anything you can sell (clothes or toys the children have outgrown, consider living without a car if its practical to walk to work and see if there are any other avenues open to make more income).  One of the things we did when things were bad was enter lots of competitions, I know it’s down to the luck of the draw but if you stick with it wins eventually come.  We had a £3k win once that was a lifesaver and allowed us to have our tired and dated bathroom done in the old house.

If you find it hard not to splurge consider cutting up your credit cards.  Get rid of temptation. Some people freeze them so they cannot use them on impulse only when they are properly defrosted, so whatever works best at stopping you spending on a whim!

This article was interesting seeing how another family made money stretch further; I liked the idea of bulk buying special offers and not turning your nose down at value brands.

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