Step 4: Pay off your debts

If you have debts, other than a mortgage, it's important that you pay these off as soon as you can. That’s because the monthly payments towards credit cards, store cards, catalogue accounts and loans are eating up cash you could be saving, or investing.

The key to cutting down your debt and getting rid of it altogether is to change the way you think about things like credit cards. It's easy to pick up bad habits and become reliant on cards and loans - breaking the cycle will give you a much healthier financial future.

For practical guidance to help you manage and reduce your debts, first select how you feel about them:

My debts are manageable

My debts are becoming an issue

My debts are out of control

Related Content

• More guidance on dealing with debt
• Tips on building an action plan to deal with your debts
• Things to consider if you need to borrow money
• Plan your monthly budget to understand what you can afford