According to recent research over two and a half million people in Britain do not know how much debt they owe.

Young adults are particularly lacking in debt awareness, with 41 per cent of 18-24 year-olds unable to say. Their debt is most worrying as their future is the most unpredictable, from house prices to pensions.

The figures have triggered a need for greater awareness of debt management solutions from the Government.

The right advice can make a huge difference to someone’s long-term financial stability.

Although it’s never too late to seek expert advice, putting it off can make a situation much worse. For example, the Department for Trade and Industry has revealed that the average debt at the start of an Individual Voluntary Arrangement (IVA) is now £52,700, more than twice the UK’s average wage.

The earlier debt is tackled the greater the range of solutions they can choose from. For many people, IVAs are indeed the best way forward, but others may be better off taking out a debt consolidation loan or joining a debt management programme.

If you are in debt, there are a number of ways to start tackling them. The solutions may not be as easy as having them paid off in the short-term but even by reducing them by a small amount ever month can save you money on interest.

First you should always asses your priorities and where your money needs to go into order for you to continue living.

The most important thing to remember when servicing your debts is that you don’t forget to pay your everyday bills such as rent/mortgage payments, council tax, water, gas and electricity.

Once you have figured out how much money needs to go out, find out how much money you have coming in. Work this out on a weekly or monthly basis. Include your take-home pay, any social security benefits and money from other sources.

Work out your essentials like such as food and fuel on a weekly or monthly basis and include occasional payments such as entertainment. Once you have figured out all your outgoings and how much you have left over, draw up a budget and stick to it.

In the budget work out how much you can easily afford to pay each week or month and how long it will take you to tackle the debt.  

Tackling debts takes time and it’s not always as easy as consolidating them through your back or taking out other loans to pay them off in the time being. Debt is a serious problem in the UK with many of us spending way beyond our income and our means.

Our spending can be easily controlled if we take a good look at exactly where our money is going. Most of us will be surprised to learn how much money we are spending on eating out and alcohol alone. While it is important to enjoy our money we work hard for, the last thing we need is to pay for the fun we’ve had in the past rather than the fun we could be having in the present.

The author of this article is Heather Ale, who draws on extensive journalistic experience to write on specialist finance matters.  She has worked across the world and is a leading writer in her field.

This article does not represent ‘financial advice’ as each person's individual requirements will be unique to their specific needs. If there is something in the article which you wish to rely on, please check those details with the person/company with whom you arrange financial services such as debt management plans, IVAs or debt consolidation loans.

The views in this article represent those of the author and not those of Netbasic Limited.