If you are having a hard time paying your bills, you need to take drastic action RIGHT NOW to prevent things from getting out of hand.

If you only pay the minimum amount on your credit cards, interest will go up, making it increasingly difficult to pay your daily bills and things like your rent or mortgage. You could be at risk of losing your home.

Contrary to what the TV ads for debt consolidation companies would have you believe, remortgaging is not the answer.

Yes, you end up paying less each month, BUT you end up paying thousands in interest over 10-25 years. Because you haven’t addressed the reasons for your debt problem, and because you have money available every month, you just keep spending. In a short time you will need another long-term loan to pay off the new debts.

Here are 5 things you can do TODAY that will show you why you

overspending and help you address your debt problems before it’s too late.

EXPENSE DIARY – Every day take note of EVERYTHING you spend money on. Is

amazing how trivial things soon add up to a few pounds every day: a piece of paper or a packet of sweets when you need gas, chips from the vending machine at work, etc.

This will really highlight where your daily cash is wasted.

A computer spreadsheet is a good idea to fill out at the end of each day, but a simple notebook

enough.

BUDGET – You should write down EVERYTHING you spend your money on, ie car taxes, maintenance, groceries, kids sports, gym membership, gas, electricity, vacations, birthdays.

Then you know how much comes out each month (for yearly expenses, divide by 12,

for weekly expenses, multiply by 52, then divide by 12 to get monthly totals).

This will also highlight how much is spent on things like work lunches and school dinners for kids.

Compare your monthly expenses with your monthly income so you can see how much you have left over or how much overdraft you will have at the end of the month.

LOSE ALL THE LUXURY – Cancel or reduce mobile phone contracts, DVD membership, expensive

cable/satellite TV packages, gym membership, eliminate weekly/daily grab-and-go meals, cancel school/work dinners (take a packed lunch; work/school dinners are a big expense). These are all luxuries, so at the very least, you should cut them down or eliminate them entirely if you’re really struggling.

EATING PLAN: four people should be able to eat very well on £50-£60 a week, yes really. Is very

It is easy, however, to wander around the shops buying whatever you want (if the children are with you it is worse, if possible leave them at home). The solution is simple. make a meal plan,

Write yourself a shopping list and stick to it.

LOWER CREDIT CARD SPENDING – Credit cards are so easy to put money on and if you’re not paying off the balance in full each month, the interest is crippling.

If you can, transfer balances to 0% cards. If you are denied new credit cards, then pay the

card with the highest interest rate first, then CUT THE CARD and CANCEL! If you think you may need the card for emergencies, just keep one and hide it in a drawer.

You can reduce your debt problems without being stuck with years and years of remortgaging

payments Start today and good luck.