Depressed and in Debt

MunchkinKel

Hi. This is my first post after joining a few weeks ago, I am so depressed about the amount of debt I owe and just cant seem to get myself out of it. I try to pay off as much as I can each month and have no money left to save for my wedding in early 2010.
I currently have an overdraft of £2000 (I've had this since i left Uni 4 years ago) which I cant clear (my salary goes into a different account to give me a better handle on what i am spending etc) a car loan with £2500 left on it, a personal loan with £2500 left on it and credit card debts of around £3000. This is getting me so down at the moment I cant see a way out.

**Amy**

Hi MunchkinKel

Well done for posting and congratulations for your forthcoming wedding!

Firstly I think it would be a good idea for you to do an SOA (statement of affairs). Its basically a sheet with your monthly income and outgoings on it, including your debts, their APRs and your minimum payments.

http://www.makesenseofcards.com/soacalc.html

Use the link above and you can reformat it into MSE format and then post it. You never know what we could help you save.

Also, have you tried putting your debts into the snowball calculator? Its a way to see what would be best paying off first and roughly how soon you can expect to be debt free.

http://www.whatsthecost.com/snowball.aspx

Have you looked into a second income perhaps? Or maybe just selling lots of things you dont use/need on ebay/bootfairs/amazon/play.com? you can make a fair bit of money doing this.

Also are you keeping a spending diary? It might sound odd but it can be a real boost when you realise how much money you fritter away (on magazines and chocolate (my weakness )) and then you can start saving that money and putting it towards your debt.

First things first though, try and do the SOA, it will help you and us. xx

Dont get too depressed, there is always a way out of debt and Im sure we can help you find it.

xx

Staciep88

Welcome to the board...

Please dont panic, everyone here will be able to help you, I suggest that you post your SOA (this can be found at the top of the forum), make yourself a cuppa and let everyone tear away at your SOA, beleive me there will be ways in which you can cut back your spending on simple things. And also please remember that it may feel like your up to your neck but there are people out there that owe hundreds of thousands and they soon bounce back. I'll await your SOA

x

MunchkinKel

I'm sorry where do you do that? Am I being dim I cant see where that is?!

**Amy**

The SOA?

The link is in my thread above:

http://www.makesenseofcards.com/soacalc.html

Then if you fill in the details further down there is a button for formating with "MSE" on it and a picture of Martin. Click on that.

xx

MunchkinKel

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1015
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1015

Monthly Expense Details
Mortgage................................ 508
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 55
Electricity............................. 10
Gas..................................... 10
Oil..................................... 0
Water rates............................. 5
Telephone (land line)................... 6
Mobile phone............................ 25
TV Licence.............................. 7.5
Satellite/Cable TV...................... 8
Internet Services....................... 0
Groceries etc. ......................... 60
Clothing................................ 20
Petrol/diesel........................... 10
Road tax................................ 5
Car Insurance........................... 18
Car maintenance (including MOT)......... 5
Car parking............................. 0
Other travel............................ 80
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 3.5
Life assurance ......................... 5
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 901

Assets
Cash.................................... 200
House value (Gross)..................... 75000
Shares and bonds........................ 0
Car(s).................................. 3500
Other assets............................ 0
Total Assets............................ 78700

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 75000....(508)......0
Total secured debts........... 75000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................90........5.........19
Virgin Card....................3161......19.6......19
Car Loan.......................1250......80........6.9
Personal Loan..................1500......130.......10.9
Total unsecured debts..........6001......234.6.....-

Monthly Budget Summary
Total monthly income.................... 1,015
Expenses (including secured debts)....... 901
Available for debt repayments........... 114
Monthly UNsecured debt repayments....... 234.6
Surplus(deficit if negative)............ -120.6

Personal Balance Sheet Summary
Total assets (things you own)........... 78,700
Total Secured debt...................... -75,000
Total Unsecured debt.................... -6,001
Net Assets.............................. -2,301

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

======== Enter any other useful information below ========
I do live with someone - my fiance, but I have just posted my debt as the credit cards are all my own. The personal loan i pay a bit more of as I used most of it to pay off other debts, and the car loan i pay half of so thats why it says 1250. Hope this makes sense and hope this is right posting all these details on here!! If not oops.

neas

Aww... *Hugs*

Could you perhaps sell the car (as you probably don't and didn't need a 4k+ car on loan)... to cover the car loan?

I'm assuming your on Interest Only Mortgage repayments? This is very risky as with falling house prices you risk slipping into negative equity and increase of mortgage repayments when you come off your fixed rate (assuming your on a fixed rate).

Im assuming the following:

Bought House with 100% deposit... no equity in house
Not repaying the mortgage - Interest Only Mortgage
'bought' a car that was more expensive than needed to be. (Can solve this one easily.. sell car and buy a 500-800 quid car while you sort out rest of problems).


Solutions?

Sell Car - Downsize to smaller car to reduce loans etc
Sell House -Rent a house share with other young professionals (I did this for last 2 years... rent was 270 quid including bills! was great)

Work on reducing your O/D and debts to 0... and then start saving a DEPOSIT for a house before loading up on debt again.

it can be done but itll be hard i guess.

How out of debt is your OH? ow much does he earn? A combined SOA would be better

lindens

The thing that strikes me is that half of your total salary goes on your mortgage - this is a very high percentage. I presume that £500 is your share of the mortgage and your OH pays the rest. Do you split it 50/50? Does he earn more than you? Can you negotiate with him paying a bit less?

neas

Do you have student loans as well (goverment loan from SLC)

doodledo_2

Hi and welcome to the forum.

You have definately come to the right place.

Like someone else has said the mortgage is high compared to your wages, is this just your half of the mortgage or should this figure be half with the other being paid by your OH.

Is there any capacity for you to take on a second job maybe in the evenings or weekends just so you can chuck all the extra cash at your debts.

Do you have anything you could sell on Ebay or Freeads etc.

Staciep88

MunchkinKel wrote: »

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1015
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1015

Monthly Expense Details
Mortgage................................ 508 is this interest only or repayment? if its repayment maybe you could think about switching it to interest only unti you have no other debts?
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 55
Electricity............................. 10
Gas..................................... 10
Oil..................................... 0
Water rates............................. 5
Telephone (land line)................... 6
Mobile phone............................ 25
TV Licence.............................. 7.5
Satellite/Cable TV...................... 8 you dont need this - freeview is just as good
Internet Services....................... 0
Groceries etc. ......................... 60
Clothing................................ 20 you dont really need to buy new clothes each month surely?
Petrol/diesel........................... 10
Road tax................................ 5
Car Insurance........................... 18
Car maintenance (including MOT)......... 5
Car parking............................. 0
Other travel............................ 80 whats this?
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 3.5
Life assurance ......................... 5
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 0
Entertainment........................... 50 you dont need this
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 901

Assets
Cash.................................... 200
House value (Gross)..................... 75000
Shares and bonds........................ 0
Car(s).................................. 3500
Other assets............................ 0
Total Assets............................ 78700

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 75000....(508)......0
Total secured debts........... 75000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................90........5.........19
Virgin Card....................3161......19.6......19
Car Loan.......................1250......80........6.9
Personal Loan..................1500......130.......10.9
Total unsecured debts..........6001......234.6.....-
Could you switch these to 0% on Balance Transfers card to cut the interest?
Monthly Budget Summary
Total monthly income.................... 1,015
Expenses (including secured debts)....... 901
Available for debt repayments........... 114
Monthly UNsecured debt repayments....... 234.6
Surplus(deficit if negative)............ -120.6

Personal Balance Sheet Summary
Total assets (things you own)........... 78,700
Total Secured debt...................... -75,000
Total Unsecured debt.................... -6,001
Net Assets.............................. -2,301

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

======== Enter any other useful information below ========
I do live with someone - my fiance, but I have just posted my debt as the credit cards are all my own. The personal loan i pay a bit more of as I used most of it to pay off other debts, and the car loan i pay half of so thats why it says 1250. Hope this makes sense and hope this is right posting all these details on here!! If not oops.

You have a car but only spend £10 in petrol and £80 in other travel - do you really need the car?