We aim to make our website as accessible as possible. However if you use a screen reader and require debt advice you may find it easier to phone us instead. Our phone number is 0 8 0 0 1 3 8 1 1 1 1. Freephone (including all mobiles).
StepChange Debt Charity logo
i The advice on this page applies to anyone with personal debts taken out in the UK.

What should you do with extra money on a DMP?

Whether you’re earning a bit more due to overtime, received a windfall from a relative’s estate, or had a successful insurance claim, having a bit more extra money can feel great.

If you’re on a debt management plan (DMP) you may be wondering what to do with this extra money. We’ve summarised the main options here, and our dedicated team of debt advisors can give you more help to choose the best way to use any extra money you have available. .

It’s important to keep us updated of any changes in your income (no matter how temporary). We need to know this so we can make sure your DMP is still the best way to deal with your debts, based on your current individual circumstances.

Repay priority debts

Priority debts include arrears on household bills such as council tax, mortgage arrears or utility bills, or court debts such as fines or parking tickets.  These are considered priorities because the consequences of not paying them can be much more serious than other types of debt. These can range from disconnection of service to repossession of your home, depending on the type of debt.

We may have included priority debts in your DMP so they get a share of your monthly payment, or we may have advised you to continue paying them direct.  In either case, you should consider using any sums of money you receive to reduce or pay off these debts.  

Clearing your priority arrears can mean less pressure on you, as you’ll be up to date with your most important bills and can focus on paying off other debts.

Cover essential expenses

If you don’t have priority debts, considering putting any extra money you have towards any essential expenses you wouldn’t normally be able to afford.

For example, are there any repairs in your house that you’ve been struggling to pay for?  Are any of your kitchen appliances on their last legs and in need of replacing?

It’s also worth checking if there are any annual costs which you could pay off in full.  Good examples of this are contents insurance or car insurance. If you pay for these monthly, you’ll usually be charged quite a bit extra, and it’s much cheaper to pay for a full year in one go.  If you do this with a lump sum of money you receive, you’ll get cheaper cover and you can start saving a bit each month towards next years’ insurance so you can hopefully pay that in a single payment too.

Set some money aside for emergencies

If you’re on a DMP with us, your budget may include an amount each month to save for ‘sundries and emergencies’. Then, should anything unexpected happen, such as an expensive vet bill or vehicle breakdown, you’ll have money already set aside to go towards these costs.

If you’ve not been able to save anything towards emergencies, it could be a good idea to use some of a lump-sum towards this. Think about opening a savings account with a different bank, building society or credit union to keep your emergency savings separate from your day-to-day spending.

Put the money towards your non-priority debts

If you don’t have any priority arrears or essential expenses to pay for, you could pay any extra money you have to your remaining creditors.

Get in touch with us and let us know how much extra income you’ve received. If it’s regular extra income, such as an increase in your wages, you may be able to increase your DMP payment. This will mean that your debts will be paid off sooner.

If the extra amount is a larger lump sum, you may be able to make full and final settlement offers to your creditors. This means paying a lump sum of money in return for them writing off the rest of the debt. Our Settlement Service team can take a look at your situation and let you know if it’s possible to settle your debts in a way that’s fair for all concerned.  

If the money you’ve received isn’t enough to settle all of your debts, you could use it make a one-off higher payment to reduce your debts. This will reduce the total time it will take to clear your debts. You could do this in two ways:

1. Share out the extra money fairly across all of your creditors

You can do this by paying extra into your DMP, and we’ll share it out for you. Call or email us if you’re paying an extra amount into your plan so we know the larger payment isn’t a mistake.

2.  Pay off one or more individual debts

You may want to do this if one particular creditor is causing problems, for example by continuing to add interest or contacting you regularly. You’d need to pay the creditor off directly, and let us know once this is done so we can remove it from your plan. Contact us first if you plan to do this, as in some cases showing preferential treatment to one creditor by paying them off could cause problems, especially if you are considering an insolvency solution like bankruptcy in the future.

I’m expecting some extra income - what should I do?

If you’re expecting extra income, for example from an upcoming sale of a house, released funds from a relative’s estate, or other means, you may want to look into your options now.

While our advice is based on what your financial situation is today, we’re mindful of what your potential needs could be in the months or years ahead. We can discuss what your options are likely to be when you receive the funds, although without knowing the exact date and amount involved, we won’t be able to give you full advice on how a future sum will affect you. When you receive these funds get in touch again so we can review your budget and options.


Manage your DMP online. Update creditor details or complete your plan review at a time and place to suit you, day or night.


Helping you become debt free...

“I wish to thank your staff for all the great help they gave me when I was in so much debt.
They were a pillar of support to me.” (Leslie, Essex)

Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.

*This is the average rating of our service based on the StepChange reviews on Feefo by DMP and DRO clients three months into their solution.

© StepChange Debt Charity 2017