This is the easy part: You start by not ignoring the problem. The only way forward is through, so you’ll need to begin by making a straightforward list that will form the basis of your debt-tackling plan.  But allow us to take a step sideways from the main issue for a minute. In order to fully understand your debt, you need to understand your credit score. 

Your credit score and how to make it work for you 

It’s one of the factors in your personal finances that lenders use to figure out whether you’ll be good or bad at paying a loan back. It’s based on your whole credit history (think all the accounts you opened, cellphone contracts you signed up for, etc.). A good score means you’ve got a good history of reliably paying your debts within an acceptable time frame, and a bad score can mean that you’ve never taken credit (lame, we know), or that you’re not so good with #payingbackthemoney.  A good credit score is a great tool you can use to achieve your financial goals, because it can help you acquire important loans, like when you want to buy a house. Without a good score you could struggle to qualify for legitimate (read: no sharks) loans which could halt your goals in their tracks. Checking your credit score is also a great way to become aware of what debts you currently have (look at how effortlessly we step back into the main topic!), and how well you’re currently handling those debts. 

What to do if your credit score is bad

Look, this is obviously less than ideal, but it’s not a life sentence. Just because you have a debt problem now, doesn’t mean you’ll have one forever.  If your debts are negatively affecting your score, it may be time to chat to a financial advisor or debt counsellor about potential debt review, debt consolidation or renegotiating some of your monthly payments to be more manageable. Like we said, the only way forward is through, and you’re on the right track. If you need some help from us to get out of unhealthy debt, we’ve got just the thing. ⬇️