Here's how to effectively manage your debt - according to a finance expert

If you’ve found yourself having to take on debt to help get through lockdown, here are some tips on managing it (Photo: Shutterstock)
If you’ve found yourself having to take on debt to help get through lockdown, here are some tips on managing it (Photo: Shutterstock)

by Derin Clark

Since social distancing measures were introduced in March, many households have seen their monthly incomes reduced, with some having to take on debt to survive.

For those in this situation, as long as you are able to repay the money you borrow within a reasonable time frame, using credit cards or an overdraft to get through a difficult few months should not cause you long-term financial difficulty.

Debt does become a problem when you are continuously having to use borrowed money for everyday essentials, such as food, or are struggling to make repayments. If you are in this situation, it is vital that you seek help and advice as early as possible from Citizen Advice or a free debt charity.

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    If you’ve found yourself having to take on debt to help get through lockdown, or want to reduce debt that you already have, these tips will help you to manage your debt.

    Understanding your debts

    Before taking action to manage and reduce your debts, you first need to know exactly what you owe and to who. While it can be tempting to shy away from your debts, you need to take the time to sit down and make a list of all the money you owe.

    Once you have this list, you will be able to clearly see what debt you have and where you are paying the most interest. As already mentioned, if you find your debts overwhelming, there is help at hand through Citizen Advice or debt charities.


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    The next step you need to take is to look at reducing your debts by paying them off as quickly as possible. The most common method of tackling debt is by paying off the debt that charges the most interest, usually your biggest debt excluding a mortgage, and then the second-largest debt, until you are down to your smallest debt - keeping in mind that you will also need to make the minimum repayments on all your debts.

    Interest-free credit cards

    If you have debt on multiple credit cards or are currently paying a high interest rate on your existing credit card debt, taking out a 0% balance transfer credit card can help to make the debt more manageable and reduce the amount of time it takes to pay off.

    A 0% transfer credit card will allow you to transfer your existing credit card balance to the new card, where you will have a set interest-free period in which you can pay off the balance. Currently, the longest interest-free period on a 0% transfer credit card is 30 months, which is available on TSB’s Platinum 30 Month Balance Transfer Mastercard.


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    In order to make a 0% transfer credit card work to your benefit, you should create a repayment plan that allows you to repay the debt within the interest-free period and not borrow any money on your credit cards during that time.

    Often you will be charged a fee to transfer the debt across, 2.95% in the case of the TSB card quoted, and this should be taken into account when creating a repayment plan. As well as this, whether or not you are accepted for a 0% transfer credit card will depend on your credit score - you can carry out a free credit check on

    Consolidate your debt

    Those with large debts or who have debts owed to a range of lenders can consider consolidating their debt by taking out an unsecured personal loan. Again, whether or not you are approved for the loan and the annual percentage rate (APR) you are given will depend on your credit score.


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    Before agreeing to the loan, make sure you are fully aware of the APR, as this could significantly increase your repayments. When taking out the personal loan, only borrow what you need to consolidate your debts. In addition to this, ensure that you can comfortably make the repayments so that you do not have to take out further debt in order to meet the monthly loan repayments.

    You can find all the current 0% transfer credit cards and unsecured personal loans deals at