My first time and I am very nervous!

saver03 · 14 December 2006 at 2:57PM

My name's Lisa and I am a debtaholic!!!

I am 27 years old and the only thing that I own that is worth anything is a huge debt!

I love shopping and that is where I went wrong. As soon as I spent on my 1st credit card I was hooked and couldn't stop. Then when I filled my cards I got a low interest loan and paid them off. Then like a fool I spent on them again, got an even bigger loan, cleared off the cards and spent again! :embarasse It was such a vicious cyle.

I get a high from shopping, as my card goes through the machine and I realise the things are mine there is no better feeling. I also do not have cheap taste, diamonds, designer clothes, over 2000 cds, cvcs and books!! :embarasse

It all came to a head when I finally decided to add up all that I owed and I could not believe it. I think I prefered having my head buried in the sand!!

My loan is ok as the interest rate is very low at 5.6% however, my credit cards were killling me. I was only paying off the minimum amount each month and that barely covered the interest. That is when I decided to take control and I cut up all my cards!! I then went to my mum to talk it over and I can honestly say that she was not best pleased. I knew that I had to get out of this mess but didn't know how to. My mum :A lent me enough money to pay off my credit cards and that was such a weight off my mind. I will be paying her back every penny as in her words, "I will never learn." And she is right with that. I now have my loan and the money I owe my mum and even though it is over £20000 :eek: I finally feel in control and most importantly I can see an end to it all!

I do actually have a plan too!! I will be paying my mum £200 per month which is a lot less than I'm paying to credit card companies at the moment and that will only be coming off the actual balance so double bonus!

Now, with the extra money that I will have each month I will put it into my isa and when I have saved up enough pay off my loan early saving on the interest. Then use any extra cash I have left over ach month to pay my mum back and hopefully I wll be debt free sooner than I think.

DEBT FREE TARGET OCTOBER 2010 :eek:

bluezone · 14 December 2006 at 3:22PM

Well you seem to have found your lightbulb moment - congratulations. Now all you have to do is stick to it. Have you written yourself a strict budget to keep to - do you want to post it on here and we could see if we could help you further at all?

Serialdieter · 14 December 2006 at 4:08PM

Hi Lisa

Welcome to dfw. I think you need to do a statement of affairs, see link.

http://forums.moneysavingexpert.com/showthread.html?t=107280

There may be other areas you can cut back on that will make your dfd sooner.

Another thing I'd add is to do a spending diary, write down every penny you spend and you'll soon see where your money goes.

Jx

Psykicpup · 14 December 2006 at 4:28PM

Hello & Welcome!
no advice I'm afraid, just a 'hi' but do, do as above posters have suggested & we will get you 'cured' in no time lol

alecpr · 14 December 2006 at 4:31PM

Your being charge 5.6% on your loan, you will not get an ISA at that rate currently, could you overpay the loan, rather than save in the ISA?

iolanthe07 · 14 December 2006 at 4:36PM

What a lovely Mum. Cherish her.

duncans-mum_2 · 14 December 2006 at 10:36PM

You start by saying you have nothing to show that worth anything except for debt.... but you then mention the shopping you bought, diamonds, designer clothes CD's etc.

Could you maybe get some extra money to pay things off quicker by selling some items. Many on here sell on ebay and that helps quite a lot (unfortunately I am not one of them as I don't have anything decent enough to sell)

Worth a thought for an extra "top up"

Well done on facing up to your debt, and attacking it head on. (I second "Bless your Mum"

saver03 · 16 December 2006 at 12:59PM

Hi thanks for all the lovely replies. I do currently sell on ebay all the things that I do not use anymore. I am slowly but surely working my way through boxes of unwanted stuff under my stairs. I will do a list of my outgoings and see if anyone can help me make savings anywhere else.

Rent - £410
Gas - £50 (so high as it's winter!)
Electric - £30
NTL - £55
Mobile - £35 (on contract)
Gym - £30
Food - £100
Loan - £271.60
Mum - £200
Barclays additions account - £6.50 (includes mobile insurance+card cover)
Messaging service - £7.00
TOTAL - £1195.10

My partners income after tax - £1075
My income before tax not including any extra hours - £616 (don't know how to work out tax!!)

lynzpower · 16 December 2006 at 2:03PM

morning

Rent - £410 ( no council tax?)
Gas - £50 (so high as it's winter!) ( turn your heating down & put another jumper on! https://www.saveenergy.co.uk
Electric - £30 ( as above, everything off at the wall ! )
NTL - £55 ( whats this? TV? seems v high- cut it down, arnt ntl doing 3 for 30 quid now?)
Mobile - £35 (on contract) ( reduce your contract, weve all done it!)
Gym - £30 ( cancel this?)
Food - £100 ( We spend this on 2)
Loan - £271.60
Mum - £200
Barclays additions account - £6.50 (includes mobile insurance+card cover) ( you dont need this really do you?)
Messaging service - £7.00 ( wahs this?)
TOTAL - £1195.10

Do you not pay transport to get to work? nothing in here for TV licence/ council tax/ presents & clothes/ prscriptions & dental/ etc

I suggest you lok at martins budget planner for all the categories you need to consider

lyric_grace · 16 December 2006 at 2:04PM

Hi and welcome to the DFW, your in the right place there are lots of lovely and helpful people on here to spur you on to get those debts paid off sooner than you think! Keep checking back and you'll get all the inspiration you need! Lx

mizmir · 16 December 2006 at 2:04PM

Hi Lisa :santa2:

Welcome to MSE - you have come to the right place. Well done on turning the corner - it is recognising the problem that is half the battle. 'I'd echo the suggestion of a spending diary - I've been doing one for about 3 weeks and already it is so revealing! :eek: Can be a shock but at least you find out what you really spend!

A couple of thoughts on your SOA:

saver03 wrote:

Rent - £410
Gas - £50 (so high as it's winter!)
Electric - £30
NTL - £55 Seems very high - what package have you got? Can you cut it down a bit?
Mobile - £35 (on contract) Can you ask to go on a lower tariff?
Gym - £30 This is an obvious one to cut back until you are sorted out
Food - £100
Loan - £271.60
Mum - £200
Barclays additions account - £6.50 (includes mobile insurance+card cover) Do you need this? How likely is it to ever pay out anything? Is this stuff covered by house insurance?
Messaging service - £7.00 I'm sure you must be able to get a basic messaging service free?

TOTAL - £1195.10

My partners income after tax - £1075
My income before tax not including any extra hours - £616 (don't know how to work out tax!!)Are you self employed? If so how much tax/NI do you pay in a year? divide that by 12 and take it off your income. Really need to know your overall income. Also does this include all your household outgoings including your partner's? If not really need to know how much your partner contributes to the figures above rather than total income.

Hope this helps a little.

My first time and I am very nervous!

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