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5 ways to get on top of your debts in 2023

A man writing at a desk
How to deal with debts and get back on track (Alamy/PA)

Around a quarter of us have started the new year in debt, according to a new survey.


As the new year gets underway, the double whammy of bills from Christmas and rising living costs will be landing on people’s doormats and in their inboxes right now.

More than a quarter (26%) of people have started 2023 in debt, according to recent research from Tesco Bank.

So, how can households get to grip with their debts? Ban Mahsoub, spend and save director at Tesco Bank, shares the following tips…

1. Don’t bury your head in the sand

“It’s important to know your overall financial position,” says Mahsoub. “This means knowing how much you have coming into your bank account and how much you have going out.

“Add up any debts, including bills, loans, credit cards and any money you might owe friends and family, so you have one figure in mind. It can be daunting, but remember, you aren’t alone.”

2. Set a budget

Mahsoub adds: “The best thing to do is to put a budget in place to help you plan your spending, and it’s a good habit to get into for managing your money all the time.

“There are lots of ways to create, track and stick to your budget, so find out what works for you,” she suggests. “Try writing down a list of priorities, assign an amount to each and allow for a degree of flexibility. You can also use tools like online budgeting planners or apps to help you.”

3. Be open

Woman going through personal finances

As Mahsoub acknowledges: “Unfortunately, debt can still be a taboo topic for some. One in five people told us they’d never confess if they were in debt – but a lot of help can be found if you can speak openly.

“There are lots of charities, such as Citizens’ Advice or StepChange, ready to offer free, impartial advice.”

4. Know your options

Borrowing money is a decision to be weighed up carefully – and there may be alternatives such as using money from savings instead. It may also be worth checking your credit score and making “soft” credit searches, which do not leave a footprint behind on your score, to check your potential eligibility for credit.

If you do need to borrow, Mahsoub suggests: “It’s important to look at the different options available to you. Think about how much you’ll need, whether it’s borrowing to fund a project or cover day-to-day spending, how long you’d like to borrow it for and whether the repayments are manageable.

“And if you’re borrowing money from family or friends, it’s worth drawing up a loan agreement so everyone is clear when the repayments will be made – and how much. This is key to ensuring you feel in control of your finances and will help avoid any upset or confusion between you and your loved ones.”

5. Make sure your spending is working hard for you

Some credit cards may offer rewards points or vouchers, for example. Mahsoub says: “While they might seem small, these benefits can make a big difference.”


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