When you feel like you’re going under because you’re struggling with a debt problem, it can be difficult to see light at the end of the tunnel. The amounts you owe just keep mounting up as you can’t meet repayments and so you not only have compounding interest to pay, but you are also likely to be charged penalties when you miss payments.

Debt can spread from being a financial problem to affecting all different areas of your life, including your sleep, your health and your relationship. The worries of being in debt that come to you at three in the morning can be helped though, by facing up to the debt problem you have and beginning to deal with it. This is far more healthy a course of action than trying to hide from the problem, like the proverbial ostrich!

It may be that you need to seek debt counselling from a professional trained in dealing with debt. On the other hand, you might get the guidance you need from a friend or relative who is sensible with their own finances and can help you to budget correctly, so that you begin to generate surplus income with which to pay off your debts.

Although you may feel that it’s not possible to create a surplus at the end of each month, it’s surprising how effective a number of small savings can be. For example, you could contact the utility companies that you owe money to and ask if they have a scheme to help people who are struggling to pay the bills. And if you are keeping up with the utility bills, it’s still worth checking that the company you’re with offers the best deal – if not, it may be time to switch supplier.

Similarly, simply changing the way you shop for food will help to cut down the monthly spending. You may prefer to shop in Waitrose, but Lidl will definitely be cheaper. Until you are debt-free, you should cut back on unnecessary spending where possible.

Your debts may be at a level that no amount of strict budgeting will be enough to get you into the clear. In this case, there are other alternatives, such as entering into a debt management plan or consolidating your debts with a larger loan. Each case is different and you should seek independent financial advice before deciding which path to take.