Had my lightbulb moment this week, about 50k in debt, now where do I start?

SouthernSoftie

Hi everyone, bear with me:o

I've been reading this board for a long time. You're probably thinking 'No good blooming reading it if you aren't doing anything about your debt!', so finally I am.

I'm mainly posting because:
1. I am at home sick for a week so have the time to get everything listed..
2. I know things aren't going to get easier for anyone at the mo so thought I would sort it before I get into trouble (like I'm not already!)
3. I'm sick of interest rates crippling my ability to pay off my debts, yes they are MY debts but play fair cc companies, for they have trebled in some cases, and....
4. Because I am getting pestered by companies offering to sort out my debts, even though I am on TPS (telephone preference service). They tell me soooo many different things, and the latest is a company called ADS, who will be ringing me back later this week....again!

My questions.....
1. I am thinking of getting a debt management plan from Payplan or CCCS, are they any different? I have done a SOA and will post it at the end.

2. Any other ideas for saving money really?

Just for info, both myself and my fiance (been together 9 years) work full time. I have posted our minimum wages per month btw.
We have one son who will be 16 in Sept.
We bought our 1st house 4 years ago when it was built.
The mortgage is on 5 years fixed rate, so another year left. Only the mortgage is secured, all my other debts are unsecured.
We drive two cars.

Looking forward to making some new friends and helping others once I know what I'm doing!:j

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1100
Partners monthly income after tax....... 1600
Benefits................................ 115
Other income............................ 0
Total monthly income.................... 2815

Monthly Expense Details
Mortgage................................ 699
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 142
Electricity............................. 70
Gas..................................... 18
Oil..................................... 0
Water rates............................. 46
Telephone (land line)................... 18
Mobile phone............................ 45
TV Licence.............................. 11
Satellite/Cable TV...................... 59
Internet Services....................... 5
Groceries etc. ......................... 300
Clothing................................ 20
Petrol/diesel........................... 60
Road tax................................ 30
Car Insurance........................... 50
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 10
Buildings insurance..................... 15
Contents insurance...................... 10
Life assurance ......................... 114
Other insurance......................... 12
Presents (birthday, christmas etc)...... 30
Haircuts................................ 5
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1804

Assets
Cash.................................... 0
House value (Gross)..................... 280000
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 0
Total Assets............................ 282000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 117000...(699)......0
Total secured debts........... 117000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Capital One cc.................433.......13........16.67
Goldfish cc....................10133.....203.......20.94
Marbles........................10219.....255.......24.9
Northern Rock loan.............19900.....237.......0
MBNA cc........................448.......16........30.39
Cahoot loan....................7555......154.......15.9
Cahoot cc......................0.........0.........0
Total unsecured debts..........48688.....878.......-

Monthly Budget Summary
Total monthly income.................... 2,815
Expenses (including secured debts)....... 1,804
Available for debt repayments........... 1,011
Monthly UNsecured debt repayments....... 878
Surplus(deficit if negative)............ 133

Personal Balance Sheet Summary
Total assets (things you own)........... 282,000
Total Secured debt...................... -117,000
Total Unsecured debt.................... -48,688
Net Assets.............................. 116,312

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.

LilacPixie

welcome to the board.

OWW to your sky/net/phone costs I am with virgin get all 3 for £30 and when i threatened to leave got satanta and movies for nowt for a year. Maybe you should try a similar ploy with whoever you are with to reduce your bill.

As you have an empty cahoot card, any chance of securing a 0% bal transfer for all of your MBNA card plus some goldfish or marbles?? might be worth a call to cahoot to see. Then once you do that you may find MBNA offer you a 0% deal or low life of balance so you can transfer some more marbles or goldfish.

YOur grocery bill seems high but teenage boys and all that. Maybe have a look on old style and see if you can reduce any.

Are you sure only £60 a month on petrol for 2 cars is realistic??

shopaholictiedtheknot

Hi there I am no good at advice really I'm afraid but just wanted to wish you luck in sorting yourself out, you have taken the first step and that is the main thing, this site is so good and there are so many great people on hand I am sure you will get sorted!

SouthernSoftie

Thanks LP:cool:
Hmmm I did start to fill in that SOA a couple of months ago.
The OH only uses his car to go to work and back, less than two miles away, and I get travel allowance from work but still maybe too low, probably about £100 per month now.

Have only been on sky broadband for less than a year, so maybe a bit too soon to start to bargaining, but will def try once the year is up.....will look at the phone too because that estimate for home phone is high, we very rarely make calls.

Could try transferring to 0%, but is it worth it is going to freeze them all?
MBNA can't actually be used as I missed a payment last autumn and they'd trebled the interest without making it clear. I only noticed when I wondered why the balance was going UP not down.

The grocery estimate is including everything, I've never really sat and calculated it, maybe I should start that diary!

shopaholictiedtheknot

SouthernSoftie wrote: »

The grocery estimate is including everything, I've never really sat and calculated it, maybe I should start that diary!

Estimate is the operative word here - I used to unknowingly spend around £600 a month on grocery shopping:eek: just nipping to buy a couple of items here and there really adds up, try saving all your receipts for a month to get a true picture and then you can work from that, I have managed to more than halve mine over the last month or so

Isabelle

Hello Southersoftie

Probably no good at the advice either but wanted to say welcome and good luck!
Also very brave of you to post such a detailed list of income and outgoings, shows you mean to sort it out!
Would it be possible for you to approach some of your existing cc providers and ask for a 0% balance transfer on some of your debts? I know it doesn't reduce the amount you owe in the long run, but it does give you a bit of breathing space and the chance to pay off some of the cc with higher interest rates.
Good luck with it all, this site is fanstastic and I have saved loads of money over the last couple of years, must get round to posting a list! Hope you feel better soon.
Isabelle

SouthernSoftie

Isabelle wrote: »

Hello Southersoftie

Probably no good at the advice either but wanted to say welcome and good luck!
Also very brave of you to post such a detailed list of income and outgoings, shows you mean to sort it out!
Would it be possible for you to approach some of your existing cc providers and ask for a 0% balance transfer on some of your debts? I know it doesn't reduce the amount you owe in the long run, but it does give you a bit of breathing space and the chance to pay off some of the cc with higher interest rates.
Good luck with it all, this site is fanstastic and I have saved loads of money over the last couple of years, must get round to posting a list! Hope you feel better soon.
Isabelle

Thanks Isabelle, I'm just hoping for some good advice as I think the CCCS or Payplan is the way I'll be going at the moment.
That way if I can pay off more then they arrange it will get sorted quicker, whereas the company who keep ringing me said there is no point, as they'll just take their 5 of any extra.

Verbatim

Hello and welcome,

Well done on posting your SOA. Rather than getting worse most people find that's the worst bit and thereafter things feel better, because I suppose things are back under control rather than spiralling off upwards!

Not sure why or even if you could do a DMP as you seem to have enough "disposable income" to pay more than minimum payments, but apologies if I've misunderstood, (completely likely I realize)!

I wondered what the other insurance covered? If it's PPI on mobiles and loans/ccs these can be very bad value as they rarely pay out and if you did decide you had to have them they're usually cheaper bought as a stand alone product rather than buying with the mobile or on taking out ccs I think Martin has an article on this on the main site. Anyway you can usually cancel these and sometimes claim back premiums already paid if it has been mis-sold.

If your husband only drives 2 miles to and from work could he walk/bus/cycle instead? If so perhaps you could manage with just one car which would mean you could sell one giving you a lump sum and of course reducing your expenditure.

Lastly do you menu plan and write shopping lists based on the plan? This could cut down a lot of unnecessary spends, buying too much and corner shop visits because milk etc has run out.

Sorry for the long post. Good luck with it all and I hope you keep posting your progress.

SouthernSoftie

Thank you, yes it def feels better now I've posted and done my SOA.
The other insurance is my dental insurance as could not stay with my dentist unless I had it.
Both cars are in my name, and tbh it wouldn't be easy with only having one car as we work such varying shifts etc but it could be considered.
The disposable income is there on paper but it just isn't in real life and I don't know why... prob on his ciggies!
We have seperate bank account at the mo and I did suggest to him we have a joint one to make budgeting easier, esp as I get paid 7 weeks behind, which is what started me using the cards all those years ago.

I think the budgeting thing is my next task. Time is often my enemy, hence why now I am off I am getting things done.... as I had been doing 100hours in 10 days and getting too stressed... or knackered as I call it!

LoulaBelle

Hi There and welcome to the site

I'm sure that someone great will be along soon to help you out.

Just a few things - are you paying your council tax over 10 months? if so call the council and ask if you can pay them over 12 months - this free's up a bit of cash to throw at the debts. Also your grocery bill - can you try reducing that to £200 a month for the 3 of you - try some of the 'own brand' products - if you don't want your family to know you are doing this smuggle them into the house and dispose of the 'value' wrapping - I've done this in the past - husband thought that were 'Mcvities' biscuits - he was actually eating own brand digestives for 19p ............. and 2 packs of custard creams 26p - sometimes its just the little things were we can cut back but everything helps.

Have you tried ebaying? I'm currently addicted and yesterday was a 5p lisiting day - tell the family that you are having a massive declutter and if its not nailed down then flog it - even large items and do 'pick up only'.

You say there is yourself and husband and son - do you have a spare room you could let out?

Also - sell one of the cars and husband can walk/cycle to work - they are money eaters. We were going to do without ours about 3.5 years ago and then I found out that I was pregnant so couldn't really do the food shop on the bus but we just run the one car now.

Is there any way you can up your incomes - asking for overtime/payrise or even looking for additional part time evening work?

If I think of anything else i will post back on here.

With regards to ebay - don't be scared it can seem daunting at first but once you see that you have a bid on your first item its such a natural high!!!!

All the best LoulaBelle

Remember Martins Mantra 'Do I NEED it? Can I AFFORD it? is it CHEAPER elsewhere?'

Forgot to say - scrap Sky and get freeview instead

SouthernSoftie

LoulaBelle wrote: »

Hi There and welcome to the site

I'm sure that someone great will be along soon to help you out.

Just a few things - are you paying your council tax over 10 months? if so call the council and ask if you can pay them over 12 months - this free's up a bit of cash to throw at the debts. Also your grocery bill - can you try reducing that to £200 a month for the 3 of you - try some of the 'own brand' products - if you don't want your family to know you are doing this smuggle them into the house and dispose of the 'value' wrapping - I've done this in the past - husband thought that were 'Mcvities' biscuits - he was actually eating own brand digestives for 19p ............. and 2 packs of custard creams 26p - sometimes its just the little things were we can cut back but everything helps.

Have you tried ebaying? I'm currently addicted and yesterday was a 5p lisiting day - tell the family that you are having a massive declutter and if its not nailed down then flog it - even large items and do 'pick up only'.

You say there is yourself and husband and son - do you have a spare room you could let out?

Also - sell one of the cars and husband can walk/cycle to work - they are money eaters. We were going to do without ours about 3.5 years ago and then I found out that I was pregnant so couldn't really do the food shop on the bus but we just run the one car now.

Is there any way you can up your incomes - asking for overtime/payrise or even looking for additional part time evening work?

If I think of anything else i will post back on here.

With regards to ebay - don't be scared it can seem daunting at first but once you see that you have a bid on your first item its such a natural high!!!!

All the best LoulaBelle

Remember Martins Mantra 'Do I NEED it? Can I AFFORD it? is it CHEAPER elsewhere?'

Forgot to say - scrap Sky and get freeview instead

Thanks Loulabelle
We are already behind on our council tax so I doubt it, I did ask before we got behind and they said nope!
I already buy own brand items esp value brand items.

I am a big ebaying, it's just time at the moment. Working 10 hours a day+ means I just don't get the time to do things.
I do the rotas at work and we already can't enough people to work, hence why I work so much, hence why I am now off work. But when I go back I am not going to work so much as I just can't keep up.

I wouldn't want to go down the spare room track just yet, esp as we have dogs and I wouldn't trust anyone with them.