Debt – Don’t be a student sheep

In this buy now, pay later culture where the average UK adult has 4.1 credit cards; debt no longer carries such a stigma. The end of June 2006 witnessed a further 10.3% in UK personal debt, now standing at £1.228 billion. Arrears and expanding overdrafts are considered a way of life by many.

With so many in a similar boat, this crisis appears less critical and more inconsequential. And with this blasé and unconcerned approach, the spending continues.

Student debt, now averaged at £14,779, is likely to almost treble if this current trend continues, Barclays Bank reports. Average student debt has increased five fold since 1994 with the current expenditure for a three-year course £33,512.

Worried? While student debt is inevitable, the appropriate attitude isn’t. Debt denial is now a commonly used phrase and an even more common transaction. One in three people admit to lying about their financial situation to family, friends and even advisor’s. But it is this head in the sand syndrome that prolongs the problem.

Being aware of this inevitability and teaming it with the correct mindset is the first step to conquering the predicament. The next step is to know what your money will be going on.

If you find your debt is spiraling out of control, there are simple methods you can use to make sure you first of all reduce your exposure to rising debt and further encourage you to bring your debt under control.

Its good to talk

As soon as debt becomes a major problem - talk to someone immediately - do not let the debt fester, this will only make matters worse.

Spend spend spend

Make a list of everything you spend on. Then split this list in essential and non essential categories. You will be amazed at what can be saved by simply cutting out luxury items.

How much exactly do you owe?

Write down everything you owe. Include every debt and when repayments have to be made.

What do you earn

If you are in employment mark down what you earn, find out what benefits you are entitled to and even if you are paying too much tax.