The recession is affecting us all one way or another and it is putting strain on our closest relationships. It is also having a profound effect on our finances.

Two problems which will occur are problems with debt and with assets that are reducing in value. Increasingly practical solutions are needed.

There is no use hiding your head in the sand, these problems will not just magically disappear and if you leave them they will get worse.

Debt and Household Management 

Some practical steps that will help:

v  Be brutally honest about how much you earn. Do not count on bonuses and overtime that  may not be paid;

v  Be equally honest about what you are spending.

v  Work out what you have to spend on essentials, and make sure you cover these; some of the luxuries will have to go for now at least. Income protection policies may be essential, but check the cover they offer - is it sufficient?

v  Do not simply leave debts to fester, or file unopened bills in the nearest drawer - you will not be turned to stone if you open them. If you really cannot, get a friend to do it for you.

v  Work out which debts cost you more i.e. which debts have the highest interest rates and pay them first.

v  If you have some savings sitting earning no or little  interest, use them to pay off your credit cards/loans that have extortionate interest rates.

v  Think about consolidating debt if the rates are cheaper - one debt is easier to manage than many.

v  Talk to your creditors some will agree to freeze interest, particularly if you have been paying off a large debt for some time.

v  If you really think you are bankrupt, see an insolvency practitioner to discuss your options, you may not need to go bankrupt.

v  Explain your problems to your family in terms that they can understand and how you all need to work together to sort them out.

v  Mortgage interest rates are low at the moment, but this will not continue if you wish or need to sell - you may have to accept less than you had hoped to sell the property for.

v  Seek help; it’s a strength not a weakness to admit your need it.

v  Know your employment rights, fish out that contract of employment and take expert legal advice.