HOW DO I PLAN MY FAMILY FINANCES WHEN I’M IN DEBT?
One in five families in Northern Ireland are struggling with debt, with single parents and larger families most at risk, according to the Belfast Telegraph. With the current economic uncertainty (coronavirus – COVID–19) , it’s no wonder that many are seeking financial security for themselves and their families. But how can you plan your family finances if you’re in debt?
1.Prioritising your Debts
A major reason people feel overwhelmed is that they don’t know where to start when it comes to paying off debts. Which debts have the highest interest rates? These should be paid off first. Store cards tend to have the highest rates of interest, so the quicker they can be paid off, the better. Listing your debts in order of a priority is a good way of getting organised, but don’t forget to meet any required monthly payments.
2. Prepare for the Future
We understand that family protection matters. Debts can come unexpectedly through death, accidents and ill health, so family insurance can help give peace of mind that your family is financially secure. Speak to our life insurance specialist to get provided with a tailored product to suit your needs and objectives.
3. Creating a Budget
Find a free online budget planner, and work out the cost of your essential expenses. Budgets can take a little effort, and no one likes working out how much they spend on monthly bills, but setting up a budget means you’re less likely to be surprised by unexpected costs, and is a great foundation for getting out of debt. Spending diaries are a great way of working out where your money is going and what could be cut back on, even if it means skipping your morning coffee.
4. Feeling Overwhelmed
No one is perfect, and we’re all guilty of burying our head in the sand now and then. But when it comes to debt, ignoring the problem can swiftly turn into a vicious cycle, and, in such circumstances, it’s normal to feel overwhelmed. So take a breath, and be honest with yourself. Open up those letters you’ve been ignoring, check your bank statement and put aside some time to figure out where you are financially.
Speak to our expert advisers at Financial Foresight to find out how you can plan your family finances and protect those most important to you.