What bills should I pay first?
The UK’s economy is sliding into a recession with reports from The Guardian stating that “British households are expected to rack up worth a combined £6bn because of the coronavirus crisis, as millions of people fall behind on credit card payments, council tax, and utility bills.”
With plenty of households racking up new debts and unpaid bills, knowing where to begin can be quite daunting. So, which bills should you pay first?
The first step is to write a list down of your monthly spendings and then separate these into two groups of either ‘priority spendings’ or ‘non-priority spendings’.
What is classed as a priority spending?
There is no absolute final list of priority spending’s but in general, these payments are ones that are classed as more important than others. Here is a general list of some ideas:
- Gas and electricity bills
- Rent and mortgage payments
- Council tax, water, and sewage bills
- Telephone and internet providers
- Car finance payments
- Food and clothing
- These spendings are a priority because they make sure that we have our basic needs in life such as food, clothing, shelter, transport, and communication systems.
What is non-priority spending?
Non-priority spendings are spendings that if you don’t pay they will not have as big as an impact on your life as your priority spending. These could be such things as gym memberships, premium music streaming services, credit cards, or non-essential beauty treatments.
Sure, these things are all nice to have but they’re not exactly necessary. Cutting down on these extra unnecessary expenses could have a big help on your bank accounts and ultimately, on getting rid of your debts.
Do I have to pay back my debts?
Failing to pay back your debts will result in consequences and actions being taken against you. Generally speaking, non-priority debts will have less of a consequence than that of priority debt.
Failing to make payments to your rent or mortgage, for example, could lead to you being evicted. Similarly, if you get into arrears with your council tax, you could face getting a visit from the bailiffs. These are just two examples of serious consequences of not paying off your priority debts.
Non-priority debts can still result in consequences if they are not paid. For example, your credit rating could become affected. However, these consequences are not considered as severe as the ones that you will receive from not paying your priority debt payments.
Are there alternative solutions to help me pay my debts?
At Money Support Group, it’s our goal to make sure that we provide you all of the options available so that you can pay back your debts.
All of our advice is completely free, confidential, and tailored to your personal situation.
Call us now at 0800 088 2303 or try our 60-second debt calculator
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