One thing that can be sure is that the future shape and availability of credit in the global market will never be the same. Whilst we all recognise that the current recession triggered by the banking crisis is global, it is not too difficult to see how life will be for the coming years until a new playing field is defined.

With many people losing their jobs or having to take either reduced wages or hours work, family incomes are being stretched all ways. Standards of living and debt repayments that were once affordable are now a drag and strain.… 

A fundamental review of the household budgets is, therefore, in order. Cutting out some of the purely discretional spend, such as health club memberships, may generate some income as might looking for a second, part time job.

On the debt side of the equation, look at all those loans or credit and store card debt and see if there is any benefit from refinancing them through a consolidation loan. Here, you take out a new loan and use the balance to pay off all your existing commitments on lower rates and better payback terms than before. This can generate some good and worthwhile additional cash flow with which to remain in control of your finances.

For the next few years, credit histories will become crucial as banks and other lenders will seek to advance money only to the best quality customers at competitive rates. Those with a less than perfect history will find it difficult and/or expensive to raise credit.

If you have… exposure through a mortgage or other expenses, then look to see whether there is any advantage in refinancing… to lock in some certainty into your budgeting. House prices have plummeted just about everywhere, so if you can, it would be better to hang on for a few years in the hope that prices may recover once the worst of the recession is over.

Credit will not be cheap or easy to obtain. Therefore, if you have some now, make sure that you keep your credit history as clean as possible so as to enhance your ability to raise a loan in the future. There are many web sites offering debt consolidation advice and many different aspects of budgeting and debt management. If required, many will also provide a range of facilities to help you stay in control.