Many people are reluctant to admit they have a debt problem to themselves, their families, work colleagues or their closest friends. Debt can surprise the most prudent person and the consequences will always get worse if its left and ignored.

Acknowledge the Problem

Whichever recovery plan you choose you must always begin by acknowledging you have a debt problem and understanding the scale of the debt. Often debt is hidden or forgotten  for so long that by the time the debtor has finally acknowledged the scale of their problem their only option might be forced bankruptcy or insolvency.

Next, prepare a budget listing ALL of your income and expenditure now and for the future (this is important so you can immediately understand the concept of change).

Try and stay positive! Most debt problems however severe they might look are recoverable. This is not the end.

Once you can fully understand what lies ahead and how you got in this financial position debt recovery can be fairly painless if handled correctly.

Debt is like an illness

The constant worry of debt is unsettling. The secretive nature of the problem makes the general subject taboo and it can make a previously outward and bright person, withdrawn and moody. Unmanaged debt can cause problems at work, serious relationship problems and ultimately lead to marriage breakdown.

Debt can often be a symptom of a wider problem. Unless the cause of the symptoms are taken care of the debt cycle will most likely begin again.

What causes debt?

The debt disease can be caught in many ways and effects different people from all walks of life. A sudden change of financial circumstances such as an increase in mortgage rates, drug and alcohol abuse, compulsive spending, gambling, a care free attitude to money and many human tendencies all create financial problems and feed the virus-like grip on your finances that debt can have. Whatever the problem it must be identified and addressed.

The First Aid

Before any debt plan can begin you must stop the situation getting any worse. The chances are you will be missing payments, getting charges, paying high interest on the minimum payment when you can afford it and you need help. You must treat the problem.

There is no such thing as a quick fix.

As a debt problem is a symptom of a wider problem, a well wishing relative or friend that simply settles the debt might only be delaying the inevitable unless the debtor embarks on a recovery plan to prevent him or her slipping back into the debt cycle.

Borrowing money from family, although a favoured option can sometimes cause ill feeling with other family members. If you are lucky enough to borrow money from a family member make sure that you include in your future budgets the repayments for any loan to clear debt.

Do you have  a serious debt problem?

• Missing direct debits and getting over limit fees
• Arrears on your mortgage
• Cheques being dishonoured
• Your card is rejected
• Having  difficulties paying off the monthly limit on your credit card
• Late paying bills (telephone, gas and electricity etc.)
• Spending more than you earn
• Don't know how much debt you are in
• Avoiding phone calls and hiding letters

If you have any of these symptoms you need some fist aid for your finances

How bad is Your Debt Problem

Serious debt poses immediate problems. One of the first things you must do is prioritise your debts.

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