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May 01, 2026
How much debt are you in?
Debt is something that we don’t like to talk about – or even think about. It’s easy to assume that everyone else is managing ok and we are the only ones struggling. But that is not the case at all.
By the end of 2025, the average UK household consumer debt – such as personal loans and credit cards – was £8,304. Many households also owe up to £10,088 in student loans. And those with a mortgage owe an average of £197,811 on their homes.
As well as this, the charity StepChange have identified that many households are in debt on essential bills, and that this situation has become the “new normal” for many low-income households. Arrears on housing, utilities and Council Tax all increased last year.
So if you are in debt, you are definitely not alone. But what can you do about it?
The good news is that there is help available for those in serious debt. There is a government-backed money advice service called Money Helper which has a very helpful section on Dealing with Debt.
There are also various other independent debt advisory services including:
These debt advisory services can help you to talk through your situation and then suggest options that can help. These may include making arrangements with your creditors to delay, reduce or even cancel some of your debts, through a debt management plan or Individual Voluntary Arrangement (IVA).
So if you do feel you are drowning in debt, it is definitely worth contacting one of the above debt advisory services to see how they can help. But there are also some practical steps that you can take yourself to help climb out of debt. Let’s take a look.
However large or small your debt, there are a few things that you can do to start finding a way forward. Below are some suggested ways to do this.
Debt is very worrying but it’s important to understand the extent of the issue so that you know what needs to be done about it. So the first thing to do is to make a list of all your debts, including bill arrears, personal loans, overdrafts and credit cards. For each debt, you need to be clear on:
Once you have all this information, you are in a position to start planning what to do about it.
Now that you have a clear picture of your debts, you need to decide which to tackle first. It’s important to keep making regular repayments into all your debts if you can, but there may also be some that you need to try to clear first.
If you are in arrears on your mortgage or rent, Council Tax, energy, or court fines or child maintenance payments these are the important bills to catch up with first as non-payment could lead to longer-term consequences such as eviction, fines, disconnection or other kinds of enforcement.
And when looking at loans, credit card debts etc, it makes sense to try and pay off the most expensive ones first, for example those with higher rates of interest.
So as well as an overall picture of your debts, you need to decide which are the debts you need to repay first.
The next stage is to see if there are any options to enable you to pay or at least reduce some of those debts now. Three possible options could be:
If you have any savings, it could be worth using some of them to reduce your debts. This can be a tough decision, especially if you have been saving for something special. But once you are freed from debt, you will be able to start rebuilding your savings again.
You can make money by selling unwanted goods online, on platforms such as eBay and Facebook Marketplace. Even if this is not a significant amount, every little bit helps. Whether it’s furniture, other household goods, clothes or anything else, it’s worth a try. Or you could take this further and consider selling your car if you could manage without one for a while, just to get your finances back on track.
If you have a large number of small debts another thing to consider is taking out a debt consolidation loan which could enable you to pay off all your current debts and be left with just one loan to repay, ideally at a lower rate of interest than some of your previous debts.
Once you start repaying debt it’s important to know how much you can continue to afford to repay each month. So another important step to help you get out of debt is to work out a realistic monthly budget to understand where your money is going.
To create a budget, start by making a list of all your expenditure : everything you spend in a typical month. This needs to include fixed amounts such as mortgage/rent, household bills and debt repayments, and variable amounts such as food, household goods, clothing, transport, socialising etc.
Then make a list of all your income : all the money you have coming into the household, such as salary or wages, tips, bonuses, and benefits.
Your budget will enable you to see whether you should have enough money coming in to cover your monthly expenditure. It’s also important to check your budget carefully for a couple of months, by tracking what you spend in a notebook or on your phone. You may well find that you are spending more than you thought in one or more categories. This can come as a bit of a shock, but at least you know where your money is going in reality.
If your budget efforts clearly show that you are spending more than your income, something needs to change, or you will continue to build up debt. To balance your budget you either need to increase your income or reduce your expenditure. Ideally both. But how?
While paying off debt, make it your goal to find any and every legal way to make more money. If you focus all your efforts on this for the rest of 2026 it could make a huge difference.
Here are a few ideas on ways to increase your income:
Some of the above are more life-changing than others, but could be a short term solution to getting rid of your debt.
As well as finding ways to increase your income, do everything you can to reduce your expenditure and spend less money. A few things to try here are:
It’s also a good idea to work together with family and friends to help each other reduce expenditure. One way to do this is to bulk buy together and all benefit from the savings. Or another could be to set up some kind of favour trading system where you lend your time and expertise to help someone and they then do the same for you. Be it DIY, decorating, gardening, computer expertise, car maintenance, hair and beauty, babysitting, dog walking you could help each other save money whilst still getting things done.
We hope that the information in this article helps you find ways to start getting out of debt in 2026.
If at any stage you are considering a debt consolidation loan, remember that Loans 2 Go offer a range of personal loans – including loans for bad credit – which may be able to help. Full details, including terms and conditions are available on our website. Borrowing is optional and may not be suitable for everyone, so always consider your circumstances and affordability before applying.
For more useful tips on family finances and everyday living, check back here soon with us at Loans 2 Go.
This blog/article provides general information only and does not constitute financial advice.
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Drowning in debt? Where to find a lifeline 
