The second important step is to work out a simple financial statement to show your creditors. This shows how much income you have and how much money you need to meet basic expenses.
A financial statement is an essential tool when dealing with debt problems. It presents a clear picture of individual or family income, identifies expenditure and clearly shows available disposable income.
Once you have completed a financial statement, you can demonstrate your current financial position to creditors or courts and develop a strategy for dealing with your debts. It’s important to make sure your financial statement is realistic. It should always reflect what actually happens in practice, leaving you with enough money to pay your main expenses. A realistic budget is an essential tool for solving debt problems.
The financial statement may become a vital document and is an extremely useful tool when dealing with creditors, as it forms the basis for any proposed repayment schedule.
Download a sample financial statement [PDF, 41.0Kb] that you can adjust and use to show your income and expenditure.