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    • DebtFreeWannabeSteph
    • By DebtFreeWannabeSteph 13th Jan 18, 4:41 PM
    • 1Posts
    • 0Thanks
    About to embark on a Debt Management journey - advice needed :)
    • #1
    • 13th Jan 18, 4:41 PM
    About to embark on a Debt Management journey - advice needed :) 13th Jan 18 at 4:41 PM
    Hey, newbie here!!
    As my name states, hoping to be debt free!

    So I currently have £6794 Debt compromising of: overdraft, credit card, payday loans and store cards. I also have a Bamboo guarantor loan which I currently pay off £243 a month for with a remaining total of £7533 on it (interest charges included).

    Anyway, I've been up to date with all my minimum payments so far.. just about!!! But I've come to realise I literally have no money at all. I'm frequently borrowing from more payday loan companies to pay my minimum payments on store cards or my credit card. (My bamboo loan comes out the day I get paid so I have never missed a payment with them thankfully).

    I've decided enough is enough, I can't keep getting payday loans with their extortionate interest rates. I've read up on my options and I've decided to start a debt management plan with a charity. I'm aware of what charities are out there but my main concern is not knowing exactly what I need to do before I enter into the plan. I've read around and forums have stated that I should save as much before entering to make and emergency fund? New bank account? Not paying anything else on my debts? Cancelling CPA payments so payday loan companies cannot take money?

    I don't mean to sound silly but I would really appreciate a step by step guide off somebody about how I can go about getting everything in order so I can begin my debt free journey!

    Also, I'm hoping not to include my bamboo loan in the DMP because it's a guarantor loan and I would hate for my friend (who has recently taken a pay cut) to make up the payments. My end date for the loan is the 18.07.2020 so quite far away for someone else to be paying it for me! Has anyone ever left a debt out of their plan?

    I currently get £1238 per month (work wage and child benefit) and with my current outgoings (rent, phone, Childcare, Bamboo loan etc) I've calculated they are roughly £1156 per month. This leaves me with around £82.

    I have stretched my budget plan as best I can. I understand it's going to be a good few years till I'm completely debt free but I'm feeling positive now I'm facing up to my problems! Also, in July when it's the school holidays (I'm a teaching assistant) I'm hoping to get an evening job for the extra income whilst I'm still getting paid from my teaching job over the summer. And in September I'll hopefully be getting a better paid job as I do have a degree and settled for a lower paid job at the same school as my son so I could be close to him incase he had difficulty in his very first school year. So hopefully in July time I can also look for a new job for September so hooefully I'll be able to pay more into my DMP.

    Apologies for the long post.. all help greatly appreciated
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    • Fireflyaway
    • By Fireflyaway 13th Jan 18, 6:26 PM
    • 1,571 Posts
    • 1,682 Thanks
    • #2
    • 13th Jan 18, 6:26 PM
    • #2
    • 13th Jan 18, 6:26 PM
    I was in a similar position. First thing is to stop borrowing. Second do a budget ( not including debts) to see how much you have left.
    You don't have to go via a debt management organisation, you can do it yourself. Just phone and explain you are struggling and can't afford your priority bills. Negotiate lower payments on all debts then concentrate on the smallest and pay that off. Then the next smallest and so on.
    I decided that living without constant stress was worth the hit to my credit file so I entered into payment arrangements. My tip is to be firm. Don't let them push you into ' agreeing' to more than you can afford.
    Think about your future though. Sometimes protecting your credit is important - if you need a mortgage soon. However at other times I'd argue it doesn't really matter! Living comfortably is more important than a number on a computer.
    • sourcrates
    • By sourcrates 13th Jan 18, 8:05 PM
    • 13,436 Posts
    • 12,847 Thanks
    • #3
    • 13th Jan 18, 8:05 PM
    • #3
    • 13th Jan 18, 8:05 PM

    Your guarantor loan is a priority debt, unless you want to lose this person as a friend, keeping up those payments are essential.

    You need to stop the cycle of borrowing, permenantly, it won’t be easy, it may get worse before it gets better, and your credit file will suffer as a concequence.

    An SOA is usually the first step, but you appear to of worked out what you have left, so in answer to your question, an emergency fund is essential, usually getting your accounts defaulted is a priority too, otherwise you risk the dreaded AP markers, a few months of token, or no payments, (A) adds to your emergency fund, and (B) encourages defaults.

    Only then should you start your DMP, either with a debt charity, or self managed.

    That’s it in a nutshell.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to Any views are mine and not the official line of

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Free Legal advice see :
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