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    • HopefulHumphrey
    • By HopefulHumphrey 29th Aug 17, 1:51 PM
    • 12Posts
    • 13Thanks
    Debt free in 3 years...? here's hoping for me and my boy
    • #1
    • 29th Aug 17, 1:51 PM
    Debt free in 3 years...? here's hoping for me and my boy 29th Aug 17 at 1:51 PM
    Right, so last month I decided I needed to get my debt in order. I am a single, working mum with a son (10 months old) and my debt is currently crippling me.
    After much pondering over an IVA I decided to go it alone as I did not want to cloud of an IVA hanging over me when I could have potentially paid off the debt and I also resent paying another lender extortionate fees when I am already paying lenders extortionate fees by way of interest.

    So here is my debt situation:

    Pay Day Loans: 1250
    Credit Cards: 5250
    Hire Purchase: 8300 remaining
    local council: £800 benefit over-payment - I am disputing this
    Mum: who knows

    These are rough figures as I am writing this without my finance sheet in front of me, but I know to the nearest 100.

    Much of my debt was amassed whilst pregnant and on maternity leave. I don't want to get the violins out, but whilst pregnant my partner left me in a privately rented flat, of which I was then made homeless as I couldn't keep up with the rent on my own and the landlord was unwilling to accept me with a top up from Housing Benefit. I then found a home via intermediate rent, which was unfurnished for me and my then 6 month old. As I was on maternity pay my mum paid the first few months rent for me whilst waiting for housing benefit. But I furnished the flat via credit.

    My mum has been an absolute superstar, but is a low earner and has helped me out by using most of a redundancy payment that she received. Knowing this makes me feel sick to my stomach and I will pay her back!

    So what have I done to help myself so far...?

    1. Got all my debts together in one place so I know whats what
    2. Returned to work earlier than planned and upped my hours (was only meant to return part time)
    3. Contacted all of my creditors and asked for a temporary stay of execution and agreed manageable repayments to be reviewed
    4. Made an agreement to myself that as soon as I was able I would get rid of my HP car (February 2018)

    The 3 year goal is to give me some gravitas to hold onto. Some quantative goal to measure myself and hold myself accountable to. I also see it as realistic. I am a good earner. My salary is decent. This debt was amassed during a hard time (OK, some of it was amassed partying and living it up in a life gone by).

    Today is my first day of repaying my debts under the new agreements. It is a low pay month for me as I had to return for 2 months at 3 days a week before my employer would increase my hours. This means that as well as a low pay month, as I work in arrears, I will have to pay the additional days childcare out of my salary before my increased working tax credits kick in. Which is going to be a killer.

    However, I am hoping that the new lunch box my mum got me will come into use and doing some batch cooking to avoid pit stops in Asda on the way home will help. There is very little else I can do to cut back this month, so hopefully that will be enough.

    Any other suggestions as to how to survive the month are welcomed!

    Signing Out
Page 2
    • HopefulHumphrey
    • By HopefulHumphrey 15th Sep 17, 2:53 PM
    • 12 Posts
    • 13 Thanks
    Im sorry if im covering old groung but could you keep a spending diary? A few monthd of writinh down every penny might show up an opportunity to save xx
    Originally posted by laurenh1

    >>>> I haven't, but I am definitely going to consider doing this. DO you have any apps that you recommend?
    • laurenh1
    • By laurenh1 15th Sep 17, 4:24 PM
    • 76 Posts
    • 285 Thanks
    First off you are not a failure! Years ago I lost my job and basically in 6 months racked up so much debt that I genuinely nevee thought id get out of it. In fact I used to get paid and not have enoygh to get food in. A bit if grit & determination and I did pay it all off, my credit rating improved fairly quickly actually and we are now fairly comfortable. That time taught me to be savvy and taught me a lot of things but it will always stay with me.

    I am not cool enough to have a budgeting app- I just write everything down in my notebook.

    I think moving home is a fab idea, I know its not ideal but its a real opportunity to get yourself straight and it sounds like its best for your boy xx
    • laurenh1
    • By laurenh1 17th Sep 17, 8:15 AM
    • 76 Posts
    • 285 Thanks
    Hope it went ok with your Mam

    Im batch cooking a load of soups today ready for the colder months!!xx
    • Suseka97
    • By Suseka97 17th Sep 17, 8:56 AM
    • 126 Posts
    • 189 Thanks
    Okay - now I'm going to get tough You are not a failure - far from it. Life can be tough and rather than let it defeat you - you've taken steps to get yourself straight. Moving home isn't an easy decision to make (and I hope things went okay with your mum). It's a short term thing to help you get yourself in a position to handle these debts. If you can just manage the best you can until you are able to get rid of that HP loan (February 18, yes) then you'll have more disposable income to work with.

    Do go online and use the StepChange debt remedy tool or alternatively visit on this site there is a great deal of useful information about debt management and many folks on the DMP mutual support thread have used their services. There is also this site again lots of useful info. Knowledge is power as they say.

    Don't let this debt thing mess with your mental health and don't put yourself down. Debt is depressing, yes, but it's a moment in time and you won't be in this position for ever. There are many, many people out there in debt - go have a read of the DMP thread and you'll see there are many of us dealing with debt issues - very successfully. That thread has people who 'self-manage' their DMP (debt management plan) which is what you are planning to do and others who use the DMP companies I mentioned previously. We are all at different stages and its a very supportive thread.
    LBM Apr13: 14 Creditors / £85k+ owed
    Current Status: 6 Creditors / £11,994
    DFD: Aiming for end of 2018
    Self-managed Aug17: CCAs pending
    • laurenh1
    • By laurenh1 17th Sep 17, 11:14 AM
    • 76 Posts
    • 285 Thanks
    Here here
    • Cherry Burton
    • By Cherry Burton 17th Sep 17, 1:10 PM
    • 78 Posts
    • 406 Thanks
    Cherry Burton

    Before you give up your flat, (is your landlord a housing association?) why not speak to Stepchange about a Debt Relief Order or some other action to help with the debt? It might be that moving in with Mum is the best thing but giving up a, relatively cheap, flat in London is a big move and not one to take without a lot of thought. You don't have to do anything in a rush, give yourself a couple of weeks and take some expert advice. It might help to have a look at this website, (I have no connection other than it has helped me in the past

    Good luck

    Debt 08/14 - £8200
    Mortgage 1/1/14 approx £50,000, 1/8/16 £31,269 1/9/16 27500 3/10/16 £25842
    1/11/16 £23987 1/12/16 £22050 1/4/17 £16312 3/7/17 £9989 1/8/17 £7,666 1/9/17 £5959
    • savetosave
    • By savetosave 17th Sep 17, 9:45 PM
    • 87 Posts
    • 179 Thanks
    I use an app called spending tracker. It looks like a brown wallet in the App Store. I think you can pay for a better version, but I find the free one perfect.
    Good luck with your journey
    • HopefulHumphrey
    • By HopefulHumphrey 19th Sep 17, 1:12 PM
    • 12 Posts
    • 13 Thanks
    Thank you Laurenh1 (any recipes worth sharing?)

    Thank you Suseka97 and Cherry Burton - I went on Debt Camel and its great. Straight into my saved websites! And thank you for pointing me to the DMP thread. I am going to follow that one now as well.

    Cherry Burton - I have thought and thought and although it breaks my heart to give up a flat that many Londoners would sell their own mothers for; I see no other option. Its really opened my eyes up to why people 'fiddle the system' so to speak. I can't tell you how many times the council have advised me to give up work in order to remain in my flat (which I could not do anyway as its a flat specifically for people with a set income). But so sad to think that I have considered giving up a well paid job and hard fought career to go on benefits to secure my own roof.

    I have considered a DRO and IVA in the past, but I am very reluctant to go into any kind of insolvency. Its a personal choice. I know that regardless of my debt, my priority bills outstrip my income so a DRO or an IVA would not benefit me as my debts are part of the problem at the moment not the whole.

    My mum has agreed to have me back. Which is more the joy of having her grandson living with her than me. Which is fine!
    I am going to speak to my health visitor about getting some support to help deal with the upheaval of moving and the feeling of taking a step backwards rather than forwards. I am also starting to make an inventory of things that I can sell and put that money torwards starting my emergency fund.

    This may sound really basic; but in regards to bank accounts and that, do you recommend separate spending and bill paying accounts? Does your emergency fund go into a savings account? under the mattress? a savings jar?
    • EssexHebridean
    • By EssexHebridean 19th Sep 17, 2:47 PM
    • 7,786 Posts
    • 40,314 Thanks
    Emergency fund into a separate savings account - this way you see the figure growing and are more reluctant to touch it. Once you know that you have a regular amount to put aside each month to build this check and see whether your bank offers a regular saver account with a higher rate of interest - Nationwide allow £250 a month into theirs for example and it pays 5%.
    MORTGAGE FREE 30/09/2016
    Sainsbugs 0% card: 22/12/16 £1229.00/£504.92 (29/08/17)
    • laurenh1
    • By laurenh1 19th Sep 17, 4:36 PM
    • 76 Posts
    • 285 Thanks
    I think your savings jar is really personal. I do my bills like this; We get paid into one account, then from that account I move my money into three other accounts, one which our bills come out of, one help to buy for my house deposit, and one emergency fund. I put money into my emergency fund for things like Christmas, holidays, if I am saving up for anything in particular and of course, emergencies. I keep a tally of what is in the emergency fund and what It is for so for example, I put money aside every month for Xmas and so a certain amount of what is is in there is ear marked for that. The idea being that if my bills and savings are separate and out of the way, I know that whatever is in my current account is mine to spend for the month and that's what I have to live on, I like not having to remember what is due to come out in bills. It is worth considering any annual expenses and breaking them down into monthly amounts and saving them so they don't catch you off guard. I hope it goes okay with your Mum, sounds like she is very supportive
    • EssexHebridean
    • By EssexHebridean 19th Sep 17, 4:58 PM
    • 7,786 Posts
    • 40,314 Thanks
    The "all in one pot" method can work brilliantly for someone who is organised to the "Nth" degree, and keeps a scrupulous tally of every transaction in and out of the account they work from Lauren - I know for example that it wouldn't work for me though - I'd get in an infernal muddle in no time at all! Generally for those new to having an EF at all we suggest keeping it separate because that underlines the "untouchable" nature of it - for someone who hasn't yet learned financial discipline and is perhaps new to budgeting having it in an account they're constantly dipping into and replenishing again can lead to the mindset that "it won't hurt" just borrowing from it for a while for something that is wanted, rather than needed.
    MORTGAGE FREE 30/09/2016
    Sainsbugs 0% card: 22/12/16 £1229.00/£504.92 (29/08/17)
    • laurenh1
    • By laurenh1 19th Sep 17, 8:31 PM
    • 76 Posts
    • 285 Thanks
    As I said, that's just what I do.
    • HopefulHumphrey
    • By HopefulHumphrey 24th Sep 17, 5:36 PM
    • 12 Posts
    • 13 Thanks
    Pay Day Alert
    Thank you.
    I think I am going to start a new savings account for my emergency fund.
    I have 2 bank accounts at the moment; so I am going to try and get it so that one is a spending account and one a bills account.
    I just need to get to a point where all my funds aren't going on bills.

    I have looked at the outgoings vs income for this month and I am £211 short before I have brought anything to eat! And, HMRC have kindly cut my child tax credit in half because I am at work full time.
    Thanks HMRC, Thanks
    I also have my little one's first birthday and christening this month (both booked and invites sent out before I took stock of my situation).

    HOWEVER, there is light at the end of the tunnel.
    I am hoping that I will be cut a bit of slack if my housing provider accepts my letter of notice on the flat. I should be reimbursed for 1 weeks rent as well as get my deposit back (or some of) and my rent account is in credit thanks to a !!!! up with housing benefit when I was on maternity leave (don't worry, it as money I was entitled to but did not apply for).
    If I get this money back I will HAVE MONEY IN MY POCKET OMG!
    Although not for long as I will give as much as I can to my mum for bailing me out over the last few months.

    So, what are my goals for this coming months pay:
    1. Start spending diary - I am actually starting this tomorrow as I think a week of broke-dom will show me that I can survive on not very much (hopefully)
    2. Confirm with Wonga and Quick Quid my repayment plan - I still have not done this as I need to send the back some more information
    3. Start repaying my benefit overpayment - separate to the !!!! up noted above. I have some days off at the end of October so I will probably just go down to the council
    4. Leave the flat and get all the money I am owed by the housing back!
    5. Start emergency fund and clearly define accounts - bills / spending / emergency fund / savings jar for Christmas at home
    6. Sell bits on e-bay

    I hope everyone else has a positive payday!

    HopefulHumphrey x
    • laurenh1
    • By laurenh1 24th Sep 17, 8:38 PM
    • 76 Posts
    • 285 Thanks
    Ahh good for you getting everything in order its a pretty good feeling to get your ducks in order, especially when ends start meeting. I was impressed when I was paying all my bills let alone when I managed to save anything.

    Planning for xmas is a good shout as is putting things to one side if you see good deals and can afford it xx
    • zippygeorgeandben
    • By zippygeorgeandben 24th Sep 17, 11:09 PM
    • 667 Posts
    • 773 Thanks
    Just want to say keep it up! It's nice to read a thread for a change where you aren't blaming debt on x, y, and z! Procrastinating does nothing for your mental health! Keep on going!
    End Sep 2016 End August 2017
    £8236.57 £4876.49
    (Tesco 4.8%) £222.61pcm
    £6185.75 £851.34 (Zopa 4.0%) £48.99pcm

    £2890.04 (Sainsburys 0% until 06/19) £140pcm
    £2000.00 £1333.35 (Sister 0%) £133.33pcm

    Total debt
    £19.766.82 £11499.70 Original DFD May 2019.
    • EssexHebridean
    • By EssexHebridean 25th Sep 17, 11:14 AM
    • 7,786 Posts
    • 40,314 Thanks
    Good work so far and a great idea to start planning ahead for things now!

    What are your plans for keeping the spending down on the little one's birthday and christening celebrations?

    The money back from the housing people - I get why you're thinking about giving this to your Mum - however, might you be better - with her agreement - to make this your emergency fund, meaning that you don't then need to be putting aside as much for the next little while to build this?

    Good idea to set things up so all your bills come from one place for sure - and all your spending from somewhere else- aside from anything else this means that at the end of each month you'll have a clear picture of what is left over from savings made on your discretionary spending - and that in turn means it's easy to see what can be paid to debt.
    MORTGAGE FREE 30/09/2016
    Sainsbugs 0% card: 22/12/16 £1229.00/£504.92 (29/08/17)
    • andydownes123
    • By andydownes123 25th Sep 17, 11:15 AM
    • 87 Posts
    • 145 Thanks
    Okay - here's my two penneth

    I'm back and feeling more miserable than ever
    OK - that's a lie, for the first time ever my son has gone to sleep in his cot without screaming.
    But - that means that I was able to finally do my SOA and it makes for quite horrific reading, because it shows I AM BROKE.
    I am very much in the red

    I absolutely need to get rid of my car as without it I will be SO much better off, but that isn't until February. PEOPLE, avoid HP!!
    I have based my SOA on my full time earnings and hoped my situation would improve. Which it has, but not by taking me into the black as I had hoped.

    This month is pretty bad so far. My mum has bailed me out for next week's childcare bill and my uncle has bailed me out in terms of grocery shopping. I'm not sure how I will be getting into work, but I will have to come up with something.

    Right - before I go off on a full on rant - here is my SOA. I have estimated things, like groceries (which include baby formula, nappies etc), clothing (for the baby and me if desperate), birthdays and entertainment. Car maintenance I have estimated for the year and divided by 12. Oh and finally, my TV, internet and phone line are a combined bill. As soon as I can in April this will be reduced to just phone and internet to bring this down.

    Statement of Affairs & Personal Balance Sheet


    Monthly Budget Summary Amount(£)
    Total monthly income 2,868.43
    Monthly expenses (incl. HP & secured loans) 2,999.16
    Available for debt repayments -130.73
    UNsecured debt repayments 166
    Amount short for making debt repayments -296.73
    Personal Balance Sheet Summary Amount(£)
    Total Assets (things you own) 0
    Total Secured & HP Debt -12,900
    Total Unsecured Debt -8,608.9
    Net Assets -21,508.9
    Household Information

    Number of adults in household 1
    Number of children in household 1
    Number of cars owned 0
    Income, Expense, Debt & Asset Details

    Income Amount(£)
    Monthly income after tax 2155.43
    Partners monthly income 0
    Benefits 413
    Other income 300
    Total monthly income 2868.43
    Expenses Amount(£)
    Mortgage 0
    Secured/HP loan payments 370.3 Considering your sizable income, this isn't too bad.
    Rent 808 This is expensive - I'm guessing you live in an expensive area. Can you commute further out.
    Management charge (leasehold property) 0
    Council tax 148.55
    Electricity 32
    Gas 19
    Oil 0
    Water Rates 0
    Telephone (land line) 0
    Mobile phone 10
    TV Licence 29.4 This should be 12.12?
    Satellite/Cable TV 57 Get rid of this?
    Internet services 0
    Groceries etc. 200 You could reduce this a little.
    Clothing 20
    Petrol/diesel 40
    Road tax 2.5
    Car Insurance 65.21 With respect, how come you are paying this monthly with a wage as considerable as yours? Also, this is equates to insurance of £800 a year. How old are you? No claims etc?
    Car maintenance (including MOT) 20.9
    Car Parking 10
    Other travel 203
    Childcare/nursery 843.3 Including travel costs you are spending £1400 just to go to work...thought about not?
    Other child related expenses 10
    Medical (prescriptions, dentists, opticians etc.) 0
    Pet Insurance/Vet bills 30
    Buildings Insurance 0
    Contents Insurance 0
    Life Assurance 0
    Other Insurance 0
    Presents (birthday, christmas etc.) 40
    Haircuts 0
    Entertainment 40
    Holiday 0
    Emergency Fund 0
    Total monthly expenses 2999.16

    Secured & HP Debt Description Debt(£) Monthly(£) APR(%)
    Mortgage 0 (0)
    Hire Purchase (HP) Debt 331.3pm (12000)
    Hire Purchase 39 (900)
    Secured & HP Debt totals 12900

    Unsecured Debt Description Debt(£) Monthly(£) APR(%)
    Vanquis 1pm (3145.34)
    Capital One 30pm (2308.75)
    Wonga 20pm (325.4)
    very 43pm (1300)
    next 20 pm (450)
    Sunny 20pm (331.2)
    Quick Quid 15pm (598.4)
    Barclay Card 17pm (149.81)
    Unsecured Debt totals 8608.9

    Asset Description
    Cash 0
    House Value (Gross) 0
    Shares and bonds 0
    Car(s) 0
    Other assets (e.g. endowments, jewellery etc) 0
    Total Assets 0
    Originally posted by HopefulHumphrey
    • laurenh1
    • By laurenh1 25th Sep 17, 7:32 PM
    • 76 Posts
    • 285 Thanks
    I know car insurance is cheaper bought annually but thats something to work towards.. I think looking at your financial situation it seems unlikely you will ne able to pay that annually for a little while, I agree that it seems dear though, have you compared it xx

    Also, are you eligible for tax free childcare? You get20 percent back on childcare. Its a bit hit & miss but if you're getting no help I would apply. Its plagued with technical problems but if you're getting nothinh any way you have nothinh to lose! My account doesnt work but I send them my invoices every month and they reimburse me.... Eventually x
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