Debt

Personal

WHAT IS IT?

Debt is money you owe to another person, business or financial provider.

IN PLAIN ENGLISH

If you've borrowed money and still have to repay it, you have a debt.

SIMPLE EXAMPLE

A £3,000 credit card balance is debt. The amount you owe, interest rate, fees and repayment plan all affect what it costs and how long it takes to clear.

WHY DOES IT MATTER

Debt can affect your monthly cash flow, so understanding the balance, rate and repayment plan is important.

THE ROCKET TEST

Debt is money you've already used that still has to be repaid.