Learn What Is Debt Management

There are times in a lot of people’s lives when they start living beyond their means. This can get out of control and then debt is the result. Debt Management comes into play when you start to take control. A good place to begin is to list income and outgoings in order that you may start to live within your means.

Recovery from debt can be a long journey along a bumpy road but budgeting and work on debt management is the only solution. The best way for you to do so is by taking information regarding your income for a certain time period as well as your expenses during that same time period. Basically, you need to come up with some sort of a budget plan that will allow you to see where your money is coming from and where it is all going to at the end of each month. A monthly budget works well, especially for those who are just only beginning to see the value of such a thing in their daily lives.

Before you can move forward, you should know that when it comes to expenses, there are at least three different types that you should be aware of. Firstly, there are fixed expenses which you will usually have to pay on a monthly basis, for example council tax and water rates. These should be given top priority. Councils are very quick to go down the County Court Judgement (CCJ) route when council tax payments are missed.

Then there are variable expenses, which can change in cost, for example supermarket shopping and buying clothes. You have some control over these.

The third basic type is your debts. These can be fixed, like a mortgage payment, or variable, for example credit card repayments. These are not always as rigid as the fixed expenses and it is often possible to negotiate with the mortgage lender.

Before you go with debt consolidation as a last-ditch effort to resolve all your debt problems, you might want to consider making a balanced budget first to see how far you can go.