The key to this really is to identify debt early and do something about it quickly. Here are some examples of what you can do to help yourself out of debt and what a debt management company will not tell you:

Plan 1) Write to your creditor(s) and ask them to accept reduced payments for a certain amount of time. Tell them what your situation is and set a time of when you expect the situation to improve and ask them to accept reduced payments.

Plan 2) Ask your creditors to freeze all interest on your account. Inform your creditor(s) that due to your financial circumstances you are unable to continue making their required monthly payments on your loan or credit card or some other type of credit. You should also offer to make repayments each month either in full now because there will be no interest added or as much as you can reasonably afford. This option can be quite time consuming and will usually mean you contacting your creditor(s) several times by telephone or letter to convince them that this is all you can reasonably afford and that your offer is reasonable. Usually though, if you get just one creditor to agree you can use this as an example to your creditors that do not agree.

Offers to creditors should be made on pro-rata bases. In other words, you offer monthly payments to your creditors that are in direct proportion to the level of debt that you have with each creditor. For example: If you have £3,000 worth of debt and creditor A you owe £1,000 and creditor B you owe £2,000 and you could afford a total repayment of £30 per month, you would offer creditor A £10 per month and creditor B £20 per month. This is just an example and you may only have £30 available for debts that are considerably more than this.

Generally, to make this option work you need to produce a budget and a creditor list. Some lenders like you to use their budget form but if you stick to your own it will be in the same format for all lenders to see. Show each creditor what you monthly income is and what your outgoings are e.g. mortgage/rent, rates, petrol, food, clothing etc. Also, produce a separate page showing what you owe to other creditors so that each creditor can see that they are being treated fairly and are being offered what you can reasonably afford to pay.

Plan 3) Ask your creditors to write off your debt (This usually works if you have a lump sum to offer. Perhaps funded by a relative). Do not expect to write just one letter and for your creditor(s) to send you a reply saying "No problem we will forget all about it!". This option is not that simple. You can however, write to your creditors and ask them to write off your debt due to some exceptional circumstances are detail them in the letter to your creditor(s). You should also state in the letter that this continued level of debt would have a serious effect on your mental and physical wellbeing. You can ask your creditors to write off all or part of your debt due to exceptional circumstances but be prepared to have to write several letters. If you think that you do have exceptional circumstances, example letters can be found on the National Debtline Website.

Plan 4) Write to your creditor(s) and ask them to accept no payments for a set amount of time and ask them to freeze interest and to stop all action on your account. This again may take some convincing and you may have to write several letters. You will also need to prepare a budget detailing why you cannot make any payments at present and explain to your creditor(s) what you are doing to change the situation and when you are likely to be able to start making repayments again.