Whatever’s lurking in your financial closet, we’re here to help you get rid of your skeletons this Halloween.
If you’re haunted by financial mistakes from your past, it shouldn’t have to hold you back forever. This Halloween, we’ve found the scariest financial skeletons that can make the bravest of us shake in our boots – and how you can get rid of them for good…
A horrific credit score
If your credit score is bad enough to send shivers down your spine, it doesn’t have to stay that way. These tricks could help you banish your bad credit…
Watch out though – because the APR tends to be higher for people with bad credit, it’s wise to make smaller payments. By only making small purchases, you can avoid paying interest by paying your balance in full every month – plus, you’ll give your credit score that all-important boost in doing so!
2) Stop applying for credit
Yep, that’s right! Every time you apply for credit, the provider will carry out a hard search on your credit report, which could give your credit score a fright.
Using eligibility checkers before you apply for credit will let you know how likely you are to get a ‘yes’ – so if you get a thumbs up, you can apply with confidence. That way, you’re less likely to make lots of unnecessary applications, which could leave your score feeling worse for wear…
3) Sign up to vote
It’s one of the oldest tricks in the book – and one of the most effective, too! If you’ve not already signed up to vote, get yourself on the electoral roll.
It’ll prove to lenders that you are who you say you are on your application. Plus, if you’ve lived in your home for around three years or more, you’ll get a big tick for having a stable address.
A County Court Judgement (CCJ)
If you’re familiar with a CCJ, you’ll know it’s something you don’t want hiding in your closet. And if you’re not, a CCJ is a court summons from a company who you owe money to – you’ll typically receive a CCJ if you’ve missed three or more payments.
Scary, right? Well fear not, because we’ve got three reasons a CCJ doesn’t have to haunt you for life…
1) Pay the remaining balance
The first thing you need to know about CCJs is that you can remove them from your credit report completely – if you pay them off within the first month of receiving one.
Remember to ask the lender to tell the court that you’ve paid your debts, and they should clear your name. If you can’t stump up the whole cost, you could agree to work out a monthly payment plan with the lender – which future lenders could look at more kindly.
2) Apply to set the CCJ aside
If you’ve got a reason to believe the CCJ has been unfairly issued – like if the company sent the letters to the wrong address, or if the amount is wrong – you can apply to cancel it. Head over to GOV.UK to find the form to fill out.
Bear in mind, you’ll have to pay a fee to apply, so it’s only worth doing if you’re completely confident you’re in the right.
3) Time is on your side
Nothing lasts forever – including your CCJ. If you’ve been handed a CCJ, remember that this will be cleared from your report around 6 years after it’s been issued. And if you’ve been making payments on time ever since, you could start to build a better impression over time.
A nightmarish budget
If you live for payday but find you’ve got nothing left not long afterwards, you might have a nightmare budget situation.
If your debts are spiralling out of control, it can be easy to stick your head in the sand. But there are ways you can turn things around…
1) Get technical
In this day and age, there’s no shortage of budgeting apps to help you sort your personal finances.
Cleo, a banking app, speaks to you through messages to help you work out your budget on a daily basis. If you make a purchase or if you’re saving for a goal, it’ll work out your new daily or weekly budget to help you keep on track.
Another app called Squirrel allows your money to be paid in gradually, so you don’t blast through your wages in one go. Don’t take our word for it, though – take a look online and see what works for you.
2) Streamline your debts
If you’re paying back multiple lenders every month, you could cut costs by merging the payments into one lump payment. How exactly?
Well, by taking out a debt consolidation loan, you could bag a lower interest rate. Plus, you could pay less each month by extending the term, which could free up your monthly budget.
It’s worth remembering, though, that while it can reduce your costs on a monthly basis, you could wind up paying more in interest over a longer period of time.
3) Split your spending into ‘pots’
Also known as a ‘jam jar’ budget, splitting your income into different pots could prevent you from burning through your wages.
Simply work out exactly how much you spend on necessities (like rent or mortgage payments, food and travel) and decide on an amount you’d like to spend on each. You could set aside these payments into separate jars or accounts.
The remainder of your money – your ‘disposable’ cash – could be transferred into another account or jar. This way, you’d only be spending what you’ve set aside for yourself, without accidentally overspending.
Above all else, if you’re struggling with debts, it’s worthwhile speaking to a free debt advisor about your options.