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  • FIRST POST
    • worriedDan
    • By worriedDan 10th Feb 17, 10:12 PM
    • 135Posts
    • 321Thanks
    worriedDan
    I don't think it gets much worse than this. Feel totally beaten
    • #1
    • 10th Feb 17, 10:12 PM
    I don't think it gets much worse than this. Feel totally beaten 10th Feb 17 at 10:12 PM
    After many years of denial, I/we have to face up to our debt situation. I am sitting here feeling like the end of out world is about to come. I feel like I have let everyone down. SOA below

    We have always had some debt but an expensive few years have seen it really spike. Most of it is in my name although some is in my wife's name. She knows that we have loads of debt but I haven't shown her the bottom line and I am not going to. Not yet anyway. Things are difficult at the moment so I want to get on top of payments etc before sharing the true extent with her. I hope that this does not make me deceitful, but I think it's the best way for now.

    Household Information[/b]
    Number of adults in household........... 2
    Number of children in household......... 1
    Number of cars owned.................... 2

    Monthly Income Details

    Monthly income after tax................ 3378
    Partners monthly income after tax....... 1010
    Benefits................................ 82.8
    Other income............................ 0
    Total monthly income.................... 4470.8


    Monthly Expense Details

    Mortgage................................ 497
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 103
    Electricity............................. 40
    Gas..................................... 82
    Oil..................................... 0
    Water rates............................. 35
    Telephone (land line)................... 10
    Mobile phone............................ 60
    TV Licence.............................. 14
    Satellite/Cable TV...................... 10
    Internet Services....................... 10
    Groceries etc. ......................... 200
    Clothing................................ 50
    Petrol/diesel........................... 160
    Road tax................................ 5
    Car Insurance........................... 60
    Car maintenance (including MOT)......... 0
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 23
    Contents insurance...................... 0
    Life assurance ......................... 40
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 50
    Haircuts................................ 20
    Entertainment........................... 50
    Holiday................................. 0
    Emergency fund.......................... 0
    Total monthly expenses.................. 1519



    Assets

    Cash.................................... 0
    House value (Gross)..................... 150000
    Shares and bonds........................ 0
    Car(s).................................. 8000
    Other assets............................ 0
    Total Assets............................ 158000



    Secured & HP Debts

    Description....................Debt......Monthly.. .APR
    Mortgage...................... 75000....(497)......1.5
    Total secured & HP debts...... 75000.....-.........-


    Unsecured Debts
    Description....................Debt......Monthly.. .APR
    cc1............................15900.....304...... .0
    cc2............................6600......200...... .18.9
    cc3............................4500......45....... .0
    hsbc...........................2700......75....... .18.9
    creation.......................4500......45....... .0
    creation.......................4600......100...... .18
    cc2 wife.......................4500......45........45
    cc1 wife.......................7000......165.......6.9
    cc4............................5000......100...... .0
    Total unsecured debts..........55300.....1079......-



    Monthly Budget Summary

    Total monthly income.................... 4,470.8
    Expenses (including HP & secured debts). 1,519
    Available for debt repayments........... 2,951.8
    Monthly UNsecured debt repayments....... 1,079
    Amount left after debt repayments....... 1,872.8


    Personal Balance Sheet Summary
    Total assets (things you own)........... 158,000
    Total HP & Secured debt................. -75,000
    Total Unsecured debt.................... -55,300
    Net Assets.............................. 27,700
Page 2
    • Money Rollercoaster
    • By Money Rollercoaster 11th Feb 17, 6:29 PM
    • 199 Posts
    • 441 Thanks
    Money Rollercoaster
    That sounds like real progress. Don't start celebrating yet though, you've got alot to do before you're clear of that debt. But you've absolutely done the right thing confronting it AND making your wife aware of the situation you're in.
    Last edited by Money Rollercoaster; 11-02-2017 at 6:33 PM.
    Living Life @ 174 BPM >> CC Balance (0%) -£2,250 - Target DFD Dec 2017 >> Loan (Car) (3.1%) -£20,724.84 - Target DFD Oct 2020
    • LabRatty
    • By LabRatty 11th Feb 17, 7:23 PM
    • 49 Posts
    • 66 Thanks
    LabRatty
    Fantastic!
    What a great start! No wonder you feel like a different person.

    If you're seeing it as a three-year project, I'd certainly reinstate the pension contributions. I missed out on 5 years worth of contributions early in my career and now, nearing retirement, I'm acutely aware of the loss.

    I'd also echo the suggestion of planning in frequent small treats, especially if you can be creative and spend time and energy instead of money. Many libraries - if you still have one - have information about free or cheap local events. Bake biscuits or a cake with your son or have a go at some bread if you feel energetic!

    Keep in touch and let us know how things go; your strategy is bound to evolve over time and people here will be as supportive as you need.

    All the best,
    LR
    Save In 2017 #109
    • CapricornLass
    • By CapricornLass 11th Feb 17, 7:28 PM
    • 55 Posts
    • 187 Thanks
    CapricornLass
    Hiya, I'm glad you told your wife. I know you probably wanted to protect her - but we women are tougher than you think! She may also have ideas on how pounds and pennies can be trimmed from your budget here and there, too, and help get the debt down faster.

    One thing that I found that helped me was You Need a Budget (YNAB) to keep track of my spending. The other thing that you must be aware of is that you have to budget for paying back debts in the same way as you do for food or the rent - I know it sounds obvious, but it took me four years to learn that lesson.

    Go back as soon as you can to paying back into your pension. I know it seems like a no-brainer not to pay in until you've paid your debts, but it will have a lasting impact on the money you will have available to you in retirement, and as Silvertabby says, it will also on the amount paid to your wife to bring your son up if you were to die in service. It will be tough enough for her without having to do it in poverty as well.

    Good luck, though. Its tough having to tighten your belt, and even harder keeping up it, but the day you pay off that last debt, I will guarantee that you will feel fantastic.
    Sealed Pot Challenge no 265.
    • When the going gets tough
    • By When the going gets tough 11th Feb 17, 8:19 PM
    • 556 Posts
    • 1,018 Thanks
    When the going gets tough
    Congratulations on making a start and sharing it with your wife. You sound determined best of luck with the journey
    • Jon B
    • By Jon B 11th Feb 17, 8:53 PM
    • 761 Posts
    • 678 Thanks
    Jon B
    Just a quick point. I notice you say you are receiving £82.80/month benefits. I'm going to guess this is child benefit.

    Judging by your net income you are going to have to pay this all back at the end of the tax year as you must be on close to £60k/year gross. If I were you, I'd opt out of receiving child benefit as soon as possible and do a self assessment after this tax year to work out what you need to pay the HMRC before 31st Jan 2018.

    Jon
    • lazer-zxr
    • By lazer-zxr 11th Feb 17, 9:37 PM
    • 351 Posts
    • 395 Thanks
    lazer-zxr
    Good luck Dan.
    Amazing similarities top where I was 2 years ago.
    My income was 3300, partners 800. With 59k of debt. I told my wife we were in a lot of debt, but there was a plan, and we were progressing nicely along the plan providing we stuck to the budget ... which has become a habit.
    Last edited by lazer-zxr; 11-02-2017 at 9:45 PM.
    DFWB £53470 of £59353 repaid. LBM feb15
    MFWB On hold due to low int rates
    • worriedDan
    • By worriedDan 12th Feb 17, 10:29 AM
    • 135 Posts
    • 321 Thanks
    worriedDan
    bit more progress this morning!
    Morning guys, thanks for all of the posts. I will be responding to some of them individually a little bit later on.

    I managed to have another debt conversation with my wife this morning. We were talking about refinancing some of the debt that is not 0%. She asked " so how much we owe exactly?"... at this point I clammed up ( again). Still struggling to get the " we owe 50K" words out. I told her that I didn't know the exact amount ( this is true as the figures on my SOA were approximate figures) but that we were talking about tens of thousands of pounds. I asked her if she wanted me to access our credit reports and write a list of all of our debts and balances. She laughed and said no and that it was not necessary. She also said that she knew that it was under control as we don't receive threatening phone calls, letters etc. The mortgage is always paid on time and there is food in the fridge.

    As I said yesterday, I do want to get to a stage where all of the exact balances etc are laid out for both of us to see, however I wan't to do this after a few months of repayment so that I can show her the progress that we are making.

    24 hours ago I was stressing that my wife was being kept in the dark about our financial situation. Since then I have....
    • Put together a budget
    • Shared details of the the budget with my wife ( she totally supports it BTW)
    • Told her that we are tens of thousands of pounds in debt
    • Offered
    to access our credit reports and give her total balances etc.

    Is this enough for now??
    • enthusiasticsaver
    • By enthusiasticsaver 12th Feb 17, 10:53 AM
    • 3,048 Posts
    • 5,072 Thanks
    enthusiasticsaver
    Several more things you can do.

    Move anything not on 0% to new 0% deals if you can't. Don't consolidate/restructure - it never works or hardly ever.

    Set up spending diary so you can check to see if you are keeping on budget.

    Set up spreadsheet with 0% deals and when they finish. Focus all spare disposable income on highest paying debt first and pay minimums on others. When all interest charging ones paid focus on those where 0% finishes soonest. It will motivate you to start seeing them paid off and dropping away.

    Cut up credit cards and start emergency savings so in the future you are not tempted to spend on a card. Remember to set up account for annual bills for car etc. You have nothing in your budget for car maintenance so you need to allocate an amount to that depending on age of car and mileage done. Same goes for house maintenance.

    How much do you realistically think you can pay off the debt by each month?
    Debt and mortgage free and saving for early retirement
    • angelpye
    • By angelpye 12th Feb 17, 11:12 AM
    • 948 Posts
    • 3,371 Thanks
    angelpye
    Well done OP you seem to be making great progress.

    I think your wife wants to know what the exact situation is but hasn't asked you to pull up credit file because she trusts you or wants to show she trusts you. To be honest I think as she has asked I would go ahead and pull the exact figures together and just tell her. You have gone this far so why not full disclosure right now?

    It will mean you both have equal knowledge of the seriousness of situation - i.e. its a high amount but have caught it in time to not let it get too out of hand given your income. But, if some of that income was to drop, loss of job etc, it could become a big problem quickly.

    There may be some tough times ahead, relative to your lifestyle, as you adjust your expenses and I think full disclosure now will remove any chance of feeling being kept in the dark or trust was misplaced in the future.

    Are you not telling her because of how it will make you feel about how far it got , or because of how your wife may feel?

    I hope that doesn't sound harsh, and your wife seems pretty calm about it all, but if I was her I would want the full hard facts and be in it totally together rather than 'protected'.

    I wish you well, and keep focused! You can do this!
    Happiness is wanting what you have...
    Debt Jan 2017: £2589.22 DFD: Sept 2022 April 2022 but this Marching Minimalist can beat that!
    Use it or Loose it gym target: Feb'17 5/6 Mar 2/6
    EF £0/£4200
    • Karonher
    • By Karonher 12th Feb 17, 11:36 AM
    • 372 Posts
    • 1,837 Thanks
    Karonher
    I can understand your wife showing she trusts you and you wanting to protect her, but her comments do make me wonder if she realises how worried you are. Tens of thousands could be £20,000 and she could see this as quite easy to pay off on your salaries, and keep up her level of spending.

    Could you set up a budget for you both to stick to for maybe 6 months saying that you want a lot of the debt gone? At that stage, you could show her the figures. If she has kept to it as well, - or as well as possible - you can congratulate yourselves on how well you have both done, if she has not bothered you can show her the figures and this may push her into action.
    Getting ready for Christmas 2017

    Aiming to make £4,500 online in 2017.
    • LabRatty
    • By LabRatty 12th Feb 17, 11:43 AM
    • 49 Posts
    • 66 Thanks
    LabRatty
    It's a really good start.

    In addition, I'd
    - get some contents insurance set up - not expensive but vital in the event of total loss through (for example) fire.
    - put the next two months budgeted council tax payments away in a separate account as the start of your emergency fund. (Tesco current account is easy to open online and pays 3% on balances up to £3000 with no conditions attached).
    - have a look at the eligibility checker and apply very selectively for a 0% BT card with the highest chance of acceptance. Doesn't matter if you're offered a lower limit than you'd ideally like; every little helps. Transfer what you can and snowball the remainder.

    Once again, well done on getting a handle on this. It looks as if you'll be someone who treats it as a project, and take pride in achieving interim targets.

    All the best,
    LR
    Save In 2017 #109
    • 117pauline
    • By 117pauline 12th Feb 17, 12:17 PM
    • 261 Posts
    • 4,308 Thanks
    117pauline
    I can't imagine how awful it has been for you, knowing the situation was so bad and keeping it secret.

    As others have said it's a great start but now comes the messy bit.

    Your first SOA is how you think you have been spending but probably isn't.

    SOAs are a work in progress. Perhaps you and your wife can sit down together and have a look at your bank statements and credit card bills to find out how you are really spending.

    It's going to take a couple of months to really understand how you spend. Are you and your wife emotional spenders? Do you shop/buy when you are tired, time stretched, fed up? These are the S** It moments which you really need to understand.

    Keep a spending diary for everything, including debt repayments for a couple of months. Yes, it can be a pain but it will help in the long term. Identify your trigger points and work out ways to avoid them.

    I hope I haven't sounded too negative but this is now your home project. The two of you together can sort this and come back stronger and wiser.

    Please build in an emergency fund as soon as possible. Also a small S** It budget for when things are tough. Small sustainable steps and goals will make a huge difference.

    Good luck
    Pauline
    Don't get it perfect - Get it going
    Better Than Before
    • Fireflyaway
    • By Fireflyaway 12th Feb 17, 4:40 PM
    • 717 Posts
    • 702 Thanks
    Fireflyaway
    You have not let your son down because you have a good income and are providing for him. In addition, you have actually calculated your debt and made a plan to tackle it. Most people do have debt of some sort and many do nothing about it but you are taking action and will pass on your new good habits to your son.
    Take a moment to watch Dave Ramsey's debt free screams on YouTube. Very inspirational. There are folks on there who pay off hundreds of thousands and some who have very low incomes or circumstances that make it really tough but they get through it just like you are going to. You have spare income so there is no reason why this won't work. Remember to cut the cards up!
    • worriedDan
    • By worriedDan 12th Feb 17, 10:35 PM
    • 135 Posts
    • 321 Thanks
    worriedDan
    It does make you deceitful. You don't have the right to unilaterally decide what's best. Your decisions affect her, and she has the right to know where things stand.

    As a practical matter, how do you expect to clear the debt if your wife isn't part of the process? Is she going to be on board with a lot of belt tightening if she doesn't know the magnitude of the problem? On another thread you mentioned that you have been in charge of the money for some time; without meaning to sound harsh, that doesn't seem to have worked out so well, so maybe it's time your wife had some input.

    You say that things are difficult, but I guarantee they will be more difficult if your wife finds out you've been hiding this from her.

    Anyway, as others have said, you are in a pretty good place for clearing this quickly. You have comfortably 3k/month to pay towards debt (current minimums plus your monthly excess). You can do this easily, and without being particularly frugal, within two years.

    I would reconsider your pension contribution, assuming you have an employer match. Usually saving while you're paying interest is foolish, but judging from your salary you're at the type of place that offers a pretty generous match, probably in the range of 100-200% (i.e you pay 8% and they pay 16% or similar). Even if you were only paying 2700/month instead of 3000/month towards your debt, you'll still comfortably clear it within 2 years. If your employer doesn't offer a match, then you should continue to forego the contributions until your debt is paid.
    Originally posted by itchyfeet123
    Thank you for your post. Your post was probably the one that made me approach my wife yesterday. There is still work to be done on keeping the lines of communication open, but at least she knows that basically, we are in a mess!
    • worriedDan
    • By worriedDan 12th Feb 17, 10:42 PM
    • 135 Posts
    • 321 Thanks
    worriedDan
    Pay as much of your debts off with your surplus as you can- it will reduce faster than you think. If it helps, clear cc1 first, then 2 etc.
    Also, get back into your pension scheme as soon as you can.
    Originally posted by Worrierwalker
    Thank you - rejoining pension scheme January 2018.

    It's a really good start.



    In addition, I'd
    - get some contents insurance set up - not expensive but vital in the event of total loss through (for example) fire.
    - put the next two months budgeted council tax payments away in a separate account as the start of your emergency fund. (Tesco current account is easy to open online and pays 3% on balances up to £3000 with no conditions attached).
    - have a look at the eligibility checker and apply very selectively for a 0% BT card with the highest chance of acceptance. Doesn't matter if you're offered a lower limit than you'd ideally like; every little helps. Transfer what you can and snowball the remainder.

    Once again, well done on getting a handle on this. It looks as if you'll be someone who treats it as a project, and take pride in achieving interim targets.

    All the best,
    LR
    Originally posted by LabRatty
    Thank you - we do actually have contents insurane - I just put it all as one figure on the SOA

    Not sure I will get additional 0% deals right now but I will definitely have a go!
    • zippygeorgeandben
    • By zippygeorgeandben 12th Feb 17, 10:45 PM
    • 446 Posts
    • 478 Thanks
    zippygeorgeandben
    please try not to worry Dan - you're a stronger team together.
    • worriedDan
    • By worriedDan 12th Feb 17, 10:49 PM
    • 135 Posts
    • 321 Thanks
    worriedDan
    please try not to worry Dan - you're a stronger team together.
    Originally posted by zippygeorgeandben
    Thank you! Trying hard to focus on the positives!
    • chevalier
    • By chevalier 13th Feb 17, 4:27 AM
    • 7,717 Posts
    • 17,910 Thanks
    chevalier
    why do you have to wait until January 2018 to opt back into the pension scheme? You have enough disposable income that you could do it now. 12 * 300 = 3600 you won't pay in and 7200 if you add your employers payments. so that is a lot of money to forego when you don't 'really' need to. Also is your wife in a pension scheme also?
    chev
    I want a job that is less than an hour driving away from my house! Are you listening universe?
    • ani*fan
    • By ani*fan 13th Feb 17, 6:23 AM
    • 1,381 Posts
    • 3,240 Thanks
    ani*fan
    Hi there worriedDan

    Good to meet you and welcome to the boards.

    It looks to me like you are getting this well under control. Well done. You also said that you recently had a big pay increase so possibly accruing the debt was before that happened? Whatever, you're in a strong position now and it looks like you're about to make the best of it.

    I think everyone's advice so far has been good so I'll not add to it. 0% transfers, budgets, spending diaries, all good.

    Regarding this...


    I managed to have another debt conversation with my wife this morning. We were talking about refinancing some of the debt that is not 0%. She asked " so how much we owe exactly?"... at this point I clammed up ( again). Still struggling to get the " we owe 50K" words out. I told her that I didn't know the exact amount ( this is true as the figures on my SOA were approximate figures) but that we were talking about tens of thousands of pounds. I asked her if she wanted me to access our credit reports and write a list of all of our debts and balances. She laughed and said no and that it was not necessary. She also said that she knew that it was under control as we don't receive threatening phone calls, letters etc. The mortgage is always paid on time and there is food in the fridge.
    Originally posted by worriedDan
    Lots of people on here worry about telling their partners so you're not alone. So far, you've been hinting at things and trying to introduce your wife gently. After you posted the above, it occurred to me that sometimes knowing a little is worse than knowing the whole story. Your wife's imagination may be running wild, are we going to get bailiffs at the door? How worried do I need to be? Are there actually threatening letters that you've been hiding? Ignorance is often not bliss at all.

    I say you sit down with her once the wee one is in bed and give it your full attention. Work out the new budget together and decide how you're going to work it (new bank accounts? Envelope system? Whatever). Tell her how much you're hoping to repay every month, all in a calm and reassuring way, and let her know it can be done without any impact on your credit rating, nasty letters or anything else. You're in a strong position so emphasise that. There is more than enough to pay the bills and put food on the table. Then tell her that you're going to have to budget like that for a while because this is the total and it's therefore going to take a few years. She's your partner and equal and she needs to know.

    You could always go a step further and share that you've been very worried about it all and didn't want to let her or your little one down. You could tell her that you just wanted to protect her from all this because you care so much. She has every right to be a bit angry and upset with you since you've been in charge of the cash, but she also sounds like a sensible woman and everyone on here can see that your intentions were good, so I'm sure she'll see that too. It can bring you closer together if you're both fully on board.

    Best of luck. I've subscribed.
    Debt at its highest £18,780
    Debt today £8,715
    • DesignNotDefault
    • By DesignNotDefault 13th Feb 17, 9:24 AM
    • 34 Posts
    • 62 Thanks
    DesignNotDefault
    Are you and your wife emotional spenders? Do you shop/buy when you are tired, time stretched, fed up? These are the S** It moments which you really need to understand.

    Keep a spending diary for everything, including debt repayments for a couple of months. Yes, it can be a pain but it will help in the long term. Identify your trigger points and work out ways to avoid them.
    Originally posted by 117pauline
    Couldn't agree more with this - becoming aware of and controlling emotions (and spending as a result) is definitely one of the steps of debt control.
    Mortgage @ May 2014 £103,347.24. Mortgage @ 2%, O/P @ £250 p/m from March '17: £93,316.68, £92,949.95, £92,314.97
    CC @ 0%: £5473.72, £5419.72, £5365.72
    Home Improvement Loan @ 0%: £602.68, £559.62, £516.56
    Intending to be mortgage-free by 2022
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