Advice for a recovering student

recoveringstudent

Hello

My first time here - I am a little nervous!

I have recently found myself in quite a bit of debt - this is the result of moving out when I was 17, supporting myself through Uni and a couple of other problems (including a lack of self restraint). I would really appreciate it if anybody could offer me some advice on my specific situation. i've outlined the bones of it here.

Monthly Incomings:

I Live with my fiance in 'his house' it's his mortgage so I pay him rent - my name will go on the mortgage whenever I feel I am ok to merge my finances with his (his finances are impeccable and he has never had a credit card!).

My salary - £1050 (after deductions)


Monthly Outgoings:

Rent/Bills/Landline/Broadband/Cable - £200 (my fiance and I have a housemate to help with these so its quite low for me)

Mobile Phone - £30.00

Contact Lenses - £24.00

DVD Rental Scheme - £10.00

Gym - £30.00

Car Insurance - £25.00

Food - £80

Rehearsal Room (for band) - £20.00 (the band provides me with occasional income)

Petrol - £75

Total - £494.00

Debts

Egg Loan - £7698.00 - APR 6.9 % £205 PCM
Overdraft - £1000 (don't know the APR but natwest so probably high!)
RBS Card - £1400 (Interest Free) - £30 minimum pcm


Total Debt - £10098 :eek:

Total Outgoings plus repayments: £729 pcm

Disposable Income: £321 pcm

I have been considering 'topping up' my egg loan to absorb the other debts so I just have one monthly payment going out - I am worried that they would turn me down though. I have never missed a payment on any of my loans, cards etc. What would you recommend?

Am I in bad shape?

Alleycat

Hi, welcome to the debt free board! Having a quick skim through, it doesn't look too bad (at least compared to my finances!).

First question, are you paying anything back on your overdraft at the moment? Can you find the apr, it should be on a bank statement. If you can post that it would help, although I would assume it is more than the egg loan and the RBS card.

Although I am no expert, I would suggest rather than consolidating, to throw all of your disposable income at the overdraft. That should hopefully clear it in about four months. If you could temporarily cut down on some of your other expenses it could be cleared even quicker than that.

£30 per month seems a little high for your mobile. Are you on contract? If so, I would suggest cancelling that and going onto PAYG. I spend only a couple of pounds a month on mine. Also, could you cut out the gym and DVD rental for a while?

Have a look at snowballinghere , it should give you a good idea of your debt free date and how much to pay off each amount.

Anyway, good luck and I am sure there will be plenty of others with more advice.

Alley

Edit: Also just thought, is your egg loan flexible? I.e. can you overpay it at all?

recoveringstudent

Thanks for the reply I'm glad you don't think I am too bad! it's hard to get any perspective sometimes!

I'm not paying anything off from my overdraft - when my wages come in I am £50 in the black and then I spend it all again. I know the rate is higher than the cards and the loan (i will find out exactly how much and post again).

I know my mobile bill is large - it's a real pain... but somewhat neccessary. I am trying to launch my band (we are semi-successful, hoping to get signed and tour around the country - it brings in some money but only really enough to cover transport, cds etc), I need my phone to contact the band, promoters etc and I need to be able to use it 24/7. I know its lame but i don't think I can give it up.

I will give the gym up and walk to work instead! I will go and cancel asap! The DVD rental I can cut as well - i just neede someone to kick my !!!!!! on that one!

My egg loan is flexible - I can overpay without any penalties at any time which is why I thought of consolidating. I really trust this company as their customer service has been excellent in the past.

Thanks so much for the help - I am excited to get going!

Alleycat

Aw, bless!! Exaclty how I felt a couple of months ago when I first started tackling mine and OH's debts. Not quite had the guts to add details to my signature but maybe soon!

These boards have taught me soo much and I really feel in control of my finances. I graduated five years ago and never really looked after my finances. I had the odd panic every few years when things went a bit pear shaped, but I always managed to pull myself back from the brink...just! Its taken a bit of stability and a 9 month old baby to kick me in the right direction.

I reckon if you can pay off the overdraft then you will really start to feel in control. I've found even though our debt is still pretty high, just knowing having it all written down on spreadsheets and knowing there will be enough money in the bank is a huge relief. I never want to owe anyone a penny ever again!

Don't worry about the mobile, we all have our weaknesses, mine being chocolate and Mcdonalds!! What sort of music does your band play?

Alley

homersimpson_3

first of all there are alot people worse off so you're not in that bad a shape.
nice to see you're getting rid of the gym & dvd rental. if you want dvd's use free trials and cancel. use cashback sites when applying to get some money.
mobile phone is way too high- get rid of it altogether or if necessary (not just wanted) change to pay as you go.
if you walk to work does this mean you're getting rid of car and so petrol and car insurance? if so use savings to target towards debt.
does your boyfriend need your rent money? why can't he let you off for a while so rent money can be targeted towards debt?
£80 on food could be reduced to about £50-65 (don't go so mad with saving that you end up making yourself ill or miserable- ensure you buy some food treats (choccie, crisps etc) and have plenty of nutritious food- fresh fruit and veg etc etc ).
the usual money making routes apply- e bay, car boot sales. if your a musician could you give music lessons?
the debt with hsbc is 0%, if you merge it with others you will end up paying interest on that debt which would aggrevate the problems. if you have overdraft chances are rate is high. if you want to take real control of finances you have to take a real interest in these things and know exactly how much you're paying in interest, debt repayments and charges. basic rule- target debts with highest apr, then the next highest apr etc. once you get rid of one the money you save on interest can be targeted towards other debts.
are other band members paying towards hire or room. if not why not? are you making more money than paying out for this band? if not leave it until debts are managable- you can always come back to it.