DEBT BUSTER
11 steps for getting out of debt including the best balance transfer 0% credit cards
TACKLING debt can seem like a daunting task - but there are simple ways to help clear what you owe.
National Debtline estimates around eight million people in the UK are currently facing financial difficulties.
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Meanwhile, latest figures from Citizens Advice reveal that 13 million people have already been unable to pay, or expect to be unable to pay, at least one bill because of the coronavirus outbreak.
If you’re struggling financially, here’s what you can do.
Work out who you owe money to
Facing up to your finances is the first step to becoming debt-free - so start by working out how much money you owe, and to who.
Having a clear breakdown of your debt will make it much easier to see a way forward.
If you don’t have your most recent bill to hand, you should contact your lender to find out what you owe.
It’s worth remembering that ignoring bills won’t make them go away - in fact, it will likely make the problem worse.
Budget and prioritise your debt
Once you’ve got this information to hand, make a clear list or spreadsheet so you can see exactly what you need to pay.
This should include exact figures, interest rates and dates of when you need to pay.
By compiling everything into one document, you can then start to work out what you can afford to pay.
Citizens Advice has a that can help you work out what you can afford.
The charity network also urges people to pay off their "priority debts" first.
This includes your rent or mortgage, energy bills and council tax, as these could leave you homeless if you don’t pay them.
After that, consider paying most towards the debt that has the highest interest and charges.
Slash your bills and save cash
From energy bills to your broadband, you might be surprised to discover how much money you could save by switching.
For example, some households are being overcharged by as much as £268 a year by their energy suppliers by being stuck on expensive Standard Variable Tariffs (SVTs) instead of cheaper deals.
You may also be able to save money on your home or car insurance, or even your phone bill by shopping around.
It's also worth checking your mortgage too, to make sure you're getting the best deal.
Use a comparison site to see what cheaper deals are available - see the box below for how this works.
It's not just switching that could save you money - check through your subscription services, such as Netflix and Amazon Prime, to see if there are any you could do without.
How to switch energy suppliers
SWITCHING suppliers is the best way you can cut your energy bills. Here's what you need to do:
Shop around: Use a comparion site like or to see what best deals are available to you.
The cheapest deals are usually found online and are fixed deals - meaning you'll pay a fixed amount usually for 12 months.
Switch: When you've found one, all you have to do is contact the new supplier.
It helps to have the following information - which you can find on your bill - to hand to give the new supplier.
- Your postcode
- Name of your existing supplier
- Name of your existing deal and how much you pay
- An up-to-date meter reading
It will then notify your current supplier and begin the switch.
It should take no longer than three weeks to complete the switch and your supply won't be interrupted in that time.
Keep checking: Make a note of when your new deal ends, so that you can switch before you get stuck on an SVT again next year.
Check if you're entitled to benefits
It’s worth checking if you’re entitled to benefits or tax credits - this will all depend on your income and personal circumstances.
Go to to see what help you can get, or use the Gov.uk online .
You’ll need to provide information about your savings, income, pension, childcare payments and any existing benefits (for you and your partner).
The type of help you could claim include income-related benefits, tax credits, contribution-based benefits and Universal Credit.
You may also find you're entitled to a reduction in your council tax.
Millions of pounds worth of benefits and tax credits are unclaimed every year.
Get a zero per cent balance transfer card
Expensive credit card interest rates can often make it harder to pay off what you already owe, which can ultimately have a knock-on effect on your debt.
If you're eligible, it could pay to switch over your existing balance to a 0 per cent interest card.
These types of cards allow you to move over what you already owe, but you won't pay interest on this amount for a set period.
You usually only get the 0 per cent interest on the transferred balance, not on any new spending - so be sure to not spend on this card.
Borrowers will also need to make sure they can repay the amount in full during their 0 per cent interest period, or you'll start paying interest on this amount again.
Typically, lenders will charge you between 15 and 20 per cent after your introductory period.
It's also worth noting that only those with excellent credit scores will get accepted for the best deals.
However, you could find yourself still accepted for a 0 per cent card, but with a lower interest-free period.
will let you know what deals you will likely qualify for.
Sara Williams of Debt Camel told The Sun you should also make sure you close off your card once you've cleared your debt, in order to resist falling back into the red.
She said: "The biggest problem with paying off debt with a 0 per cent card is that you may go on to run up more debt on the credit card you have just cleared.
"Make sure you close that card to remove the temptation - otherwise you will be back with more expensive credit card debt."
Best zero per cent balance transfer cards
WE’VE rounded up a selection of the best 0 per cent balance transfer cards.
The following information is accurate at the time of writing.
Again, always make sure you use an eligibility calculator first before you apply.
You may also not get accepted for the full 0 per cent period advertised.
When choosing a card, you'll want to take note of the length of your 0 per cent period and also how much you'll be charged to transfer your balance into the new card.
: 0 per cent for up to 30 months, 2.95 per cent fee
The longest deal currently on the market is by TSB, which is offering up to 30 months at 0 per cent.
However, there is a 2.95 per cent fee for balance transfers made in the first 90 days.
After your 0 per cent period is up, you'll pay up to 26.95 per cent.
: 0 per cent for up to 29 months, 3 per cent fee
Virgin Money is offering up to 29 months at 0 per cent, with a fee of 3 per cent balance transfer fee.
You'll pay 21.9 per cent on balance transfers after your no-interest period is finished.
: 0 per cent for up to 28 months, 2.75 per cent fee
You can get up to 28 months at 0 per cent with NatWest, with a fee of 2.75 per cent on balance transfers.
After your introductory period is up, you'll pay 19.9 per cent interest.
Sadly, this is only available to existing NatWest customers.
: 0 per cent for up to 27 months, 1.45 per cent fee
This card from Virgin Money offers a shorter 0 per cent term compared to the one above, but you'll pay less to transfer your existing balance.
With this card, you can get up to 27 months at 0 per cent, and you'll pay 1.45 per cent on transfers.
The rate after this window is the same as the other Virgin Money card we mentioned, which is 21.9 per cent.
: 0 per cent for up to 26 months, 1 per cent fee
This MBNA deal comes with a shorter 0 per cent term than the other cards we've mentioned, at 26 months - but you'll only pay 1 per cent on balance transfers.
After your 0 per cent period is up, there is a 20.93 per cent interest charge.
: 0 per cent for up to 26 months, 1.2 per cent fee
Halifax does a 0 per cent balance transfer card with a period of 26 months interest free, along with a 1.2 per cent fee on transfers.
You'll pay 19.5 per cent after your 0 per cent period is up.
: 0 per cent for up to 20 months, 0 per cent fee
Royal Bank of Scotland doesn't charge a fee for balance transfers, and you can get a 0 per cent term lasting 20 months.
However, this deal is only for existing RBS customers.
There's a 19.9 per cent charge after your 0 per cent period.
- You can find more 0 per cent balance transfer cards on the website.
Consider consolidating your debts
You could clear your debt by consolidating it into one loan, which would mean you're effectively borrowing money to pay off what you already owe.
The plus side of this, is you can merge all the money you owe into one monthly repayment with just one lender.
But it's worth doing your research before committing to a loan, as borrowing more than you can afford to pay back can also lead to a debt cycle that is difficult to get out of.
If you want to borrow a relatively small amount of money over a short period of time, a 0 per cent interest rate credit card could work out cheaper than taking out a loan, according to Salman Haqqi, personal finance expert at .
But if you're looking to borrow a larger amount for a longer term, it could be worth shopping around to find a low interest loan, he said.
Explore all your options and ask companies what impact this will have on your credit score, and what happens if you miss a repayment.
Mr Haqqi told The Sun: "Always make sure you do plenty of research and make a budget to make sure you can afford the repayments before committing."
Any loan application will appear on your credit record, so be careful not to make multiple applications or you could end up damaging your credit score.
Always use an eligibility checker first to work out if you'll be accepted.
Best debt consoliation loans
HERE are some of the best debt consolidation loans currently on offer, according to money.co.uk.
Again, always make sure you can afford to make the monthly repayments.
This information is based on the lowest representative APR and is accurate at the time of writing.
: £1,000 to £25,000, spread over 1 year to 7 years
APR with this personal loan from the AA starts at 3.1 per cent for amounts between £15,001 and £25,000.
The highest APR you'll pay, depending on your personal circumstances, is 29.9 per cent.
: £1,000 to £25,000, spread over 1 year to 7 years
The lowest possible APR you could be offered from The Post Office is 3.1 per cent for borrowed amounts between £15,001 and £25,000.
The maximum APR you could be offered is 29.9 per cent.
: £1,000 to £25,000, spread over 1 year to 7 years
TSB says the lowest APR you could be offered on amounts between £7,500 and £25,000 is 5.9 per cent.
The maximum APR you could be offered is 30.0 per cent.
: £1,000 to £25,000, spread over 1 year to 5 years
With Zopa, you could be offered 8.7 per cent APR on loans between £5,000 and £25,000.
Its website doesn't say what the maximum amount of APR you could be charged is.
: £1,000 to £20,000, spread over 1 year to 5 years
Lendable says the lowest APR you could be offered on amounts between £1,000 and £20,000 is 6 per cent.
The maximum amount of APR they could charge is 49.9 per cent.
: £500 to £25,000, spread over 1 year to 5 years
Aspire Money has a representative APR of 30.6 per cent on loans between £10,001 and £25,000.
This can jump to 49.9 per cent.
Speak to your creditors as soon as possible
If you speak to your creditor, you may be able to work out a payment plan to pay off what you owe.
You'll have to explain why you're in debt, what steps you're taking to get yourself out of the situation and how much you can afford to pay back.
However, they don't necessarily have to agree to help you - this is where free debt advice comes in.
Get free debt help
There are plenty of organisations where you can seek debt advice for free.
These include:
- - 0808 808 4000
- - 0800 138 1111
- - 0808 800 9060
These charities will be able to help you create a free debt management plan, or they will contact your creditors to try and work out a repayment schedule.
Never pay for debt advice - there are some firms that will try and charge you, but you can get help for free.
Make extra money from home
Making some extra cash from the comfort of your home could be a great way to help pay off some debts.
From selling unwanted goods, to getting paid to Google, most of these tips also require minimal effort.
Check out our round-up of ten ways you can make money without leaving your house.
Did you know you can also turn rubbish into cash - including old toilet rolls and wine corks.
Use a bill holiday for breathing space
Many lenders are currently offering payment breaks lasting up to three months, which could give you breathing space if you're struggling with bills.
You can ask for a payment holiday on a range of products, including your credit card, mortgage or loan.
However, this won't make the debt disappear and should only be used if you really can't pay your bills.
Missed payments can impact your credit score, making it harder to get accepted for finance in the future.
If you can continue to make your payments as normal, you should continue to do so without a payment break, Citizens Advice has previously warned.
This is because any unpaid interest will most likely still need to be paid back, and customers may find themselves slapped with higher rates once their payment holiday is over.
Breaks can also lengthen the term that the money is paid back, and ultimately cost more over time.
Which lenders are offering payment breaks?
THE Sun has handy guides on which bills and payments you may be entitled to get a break from.
Other options to consider
If you're really struggling to see a way out of your debt, and you've tried all the suggestions above, you might want to consider a more extreme measure.
For example, you can find information about Debt Management Plans (DMP) and Individual Voluntary Arrangements (IVA) on the and on the
A DMP is an informal agreement that's proposed to creditors individually, while an IVA is a lesser form of bankruptcy which is a legally binding agreement.
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However, these options aren't to be taken lightly - so make sure you know exactly what you're signing up to.
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For example, both of these measures will leave a negative print on your credit score.
You'll also likely pay a fee to use these arrangements, either upfront or one that'll be added on to your monthly repayments.
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