NB: If you’re struggling with money, you should talk to someone — whether it is online, by phone or face to face. Find free resources here. 

Credit cards, student loans, overdrafts, personal loans, mortgages — the list of debts is huge, so chances are you've probably got at least one. But while some debts are low-simmering and non-urgent (student loans, for example), the consequences of not paying off other debts can be serious — and super costly.  If the prospect of looking at your bank account, credit card statement, or opening envelopes fills you with a wave of nauseous dread, chances are you need to address the debts ASAP.

Worse yet, according to debt charity Step Change, debt impacts women in unique ways, with 60% of people who approach them to use their services being women. Coronavirus has undoubtedly made this problem worse: ONS data shows 66% of jobs in the retail and hospitality industries (some of the hardest hit by COVID) are held by women, compared to just 34% held by men.

OK, so debt can be a serious issue, and we're likely to see even more young women struggling with the repercussions. What's the best way to approach this gut-wrenching problem? The honest answer is that there are no quick-fixes. To pay down your debt, you have to make some sacrifices. The most important thing when it comes to debt is to face it and make a mental commitment to get rid of it as soon as you possibly can. We've outlined the most important info on smashing your debt below. 👇

Understand what debts you have and write them down

Some bills are classed as priorities because the consequences of not paying them are greater than the consequences of not paying others, eg. losing your home. Just because a debt is non-priority doesn't mean you shouldn't be repaying it, though. Non-priority debts can end up extremely costly. 

• priority debts: rent arrears, mortgage arrears, council tax arrears, gas and electricity bills, phone and internet bills, court fines, unpaid income tax/national insurance. 

• non-priority debts: credit card or store card debts, overdrafts, personal loans.

Write everything you owe down, answering the following: what non-priority debts do you have? What annual percentage rate (APR) are you paying on the interest? How much do you owe in total? What are your monthly payments? How much income do you bring home each month, and where can you cut down in order to put money toward your debt ? It also helps to order your debts, listing the debt with the higher interest rate first. Once you've written everything down, you will clearly know what you owe and the terms of the loan and interest payment due on each.

Face it and fight it

It goes without saying that you'll have to get on a budget, cut your spending and delay as many non-essential purchases as you possibly can. It's not easy, so don't beat yourself up if you stumble, especially in the early days. Next, you should decide which debt pay off method you are going to use. There are two main approaches to repaying debt: the snowball and the avalanche approach.

• The snowball method: With the debt snowball method, you pay off your debts from smallest balance to largest balance, regardless of interest rates. The idea here is that when you pay your debts from the smallest to largest balance you start to clear those little debts away very quickly, which can be very mentally empowering. 

• The avalanche method: In the debt avalanche method, you pay your debts from highest interest rate to lowest interest rate, regardless of balance. Economically, this makes the most sense. You will pay less in interest if you tackle your debts in this order, which means you'll get the most bang for your buck.
  

It's completely up to you what method you go for, so if you're struggling to decide, don't overthink it too much. Both strategies would leave you much better off than doing nothing at all!

Forgive yourself and celebrate the small wins

Unfortunately, there's still a lot of shame associated with debt, which can take a real toll on your mental health. It's so important to be kind to yourself and remember that you're not alone! We all fall prey to social pressure, marketing, and impulsive shopping habits -- the key takeaway is to be aware, know what's going on, and have a clear plan for tackling (or avoiding) expensive debts. A good way to do this is to set a 'money date' with yourself once a week and spend an hour going over your expenses. Getting real with our finances is tough, but it's oh so worth it for the peace of mind.