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Ten tips for a debt free Christmas

SHETLAND’S busy Citizens Advice Bureau is offering islanders an early Christmas present which they hope will help people avoid a festive hangover.

The Lerwick office has issued 10 tips to avoid getting over your head in debt this year.

Local CAB manager Les Irving said his office dealt with 1,071 new debt cases last year, many of whom got into financial trouble overspending at Christmas.

He urged people “to give themselves the best Christmas present they can – a New Year free of debt”, saying it would be a struggle to pay off debts incurred at this time of year.

Mr Irving said: “Every year we issue this same warning, yet every year we see people coming to our office saying they got into debt at Christmas and haven’t been able to get out of it. That’s the thing about debt. It breeds – and creates further debt!

“Once you are in debt to your bank or credit card company, the interest charges make it really tough to get back on even terms. The best way to avoid crisis is to avoid getting into debt in the first place.

“With that in mind we unveil our Top 10 Tips to avoid getting into debt this Christmas. We urge everyone to read this list. Then read it again. Then cut it out and take it with you when you go Christmas shopping! Also make sure you send a copy of it to everyone you know – particularly those who are in financial difficulty.

“The last thing we want to do is stop people having a good time at Christmas. Goodness knows we all need to relax and let our hair down at this time of year – especially in the current climate (and by that I mean economic as well as weather-wise!).

“But you don’t have to overspend to have a good time. It really is amazing how a little bit of thought and planning now could potentially save you hundreds of pounds – and a lot of grief – in the New Year. And that’s what these 10 tips are all about.

“Anyone who does get into financial difficulty – or anyone who already is – can of course get advice from the CAB. Pop in and see us at our office in Market Street or give us a call on 01595 694696 to make an appointment. Our advice is free, confidential and independent.

“We wish everyone Shetland a very happy Christmas and a healthy, safe and debt-free New Year!”

Shetland Islands CAB’s Top Ten Tips for a debt-free 2011

1. Be realistic about what you can afford! 

The worst way to do Christmas shopping is at the last minute, in a panic, pushing everything onto your credit card. Start planning now – based on what you can afford – and then stick to the plan.

2. If you can afford to pay for goods in cash – without credit – Do that!

Don’t take out credit unless it really does work out cheaper.

3. If you are using credit, shop around for the best deal

Be wary about ‘Buy now, pay later’ offers.  Are you sure you’ll have the money later?  Remember – penalties for late payment are huge.

4. Read the small print of any credit agreement closely. 

If anything is unclear, ASK before you sign.

5. Beware of Store cards.

They’re usually a more expensive form of credit than credit cards, many charging interest rates of around 30 per cent.

6. Don’t run up an overdraft without talking first to your bank

This will be much more expensive than if you agree it beforehand.

7. Remember the New Year Utility bills!

Gas and electricity bills often arrive in January/February, just when you’re feeling the pinch after the Christmas spend. And they’ll be higher than usual at this time of year. Allow for these in your budgeting.

8. When it does comes to paying those bills in the New Year, prioritise!

Payments such as mortgage/rent, gas/electricity and council tax should always come first.

9. Have you maximised your income? 

If you’re a lone parent, on a low income, unemployed, or a pensioner, there may be benefits available to you that you are not claiming. Your local CAB can help you check.

10. If you do think you’ve over-spent, Get Help Immediately!

Don’t ignore it or hope it will go away. It won’t!  Shetland Islands CAB will give you free, confidential and independent advice – but you have to ask for it asap.