Willsmum and the debt monster

willsmum_2

Hello Everyone

Firstly, I have to admit to being a "lurker" for well over 12 months and I have been doing some serious "debt-busting" on my own for a while using all of the hints and tips from you lovely people.

I had my lightbulb moment last year. I realised that I had no money to buy nappies for my son and I couldn't afford to feed my family. I had managed to rack up approximately £21,000 worth of debt and no one but me knew about it.

I had always been exceptionally well behave with money and I had never so much as gone into my overdraft. I was lucky and was brought up knowing the value of money.

Everything was fine until I had my son just over three years ago. I became very ill afterwards with Post Natal Depression and was so poorly that I had a psychiatric nurse coming to the house three times a day as I was on suicide watch. Then, whilst I was dealing with that, my cousin who was only 33 at the time died of bowel cancer after only being diagnosed 18 weeks before.

I felt as though my life was empty and started spending money like no ones business. I look back now and I couldn't even tell you what it went on. There are no new kitchens or bathrooms or even cars to show for it, nothing.

When I had my lightbulb moment I was unemployed and still suffering with PND. I wasn't earning ANYTHING and was living on my child benefit which was only £80 a month. Once all of the cards got maxed out and I was over the limit of my overdraft on my own and our joint account I had nothing - literally.

Then the phone calls started and the letters and I was so frightened I thought I was going to literally die from the fear. I used to lie awake on a firday night dreading the post man coming on a saturday when my husband would be home from work. He works Monday to Friday and so I was able to "hide" any letters or phone calls that came in that time.

It was only when I sat down and went through everything that I realised how bad things had got. It was by pure coincidence that I happened upon this site and I can honestly say I think it has saved my life. The information, guidance and support from all of you on here has been nothing short of inspirational.

So, with website in front of me I sat down and worked out that I was in £21k worth of debt with no income. It was only by reading a post on here that I realised I was in fact entitled to JSA. After I visited the job centre to "sign on" I realised that I needed to get work fast. I just couldn't live like this anymore and I was fed up of being scared in my own home.

I have been working as a PA for a little over 12 months now and I can't believe the difference. I have managed to reduce my debt down to £17.5k and I feel like I am finally in control.

Now, don't shout at me, but my husband knows nothing about these debts. I have kept them hidden from him and I have my own reasons for doing this (will fill you in later).

I will leave it there for now as I am going to pop off and do my SOA for you all to have a look at (and hopefully point me in the right direction if I have missed something).

Thanks for reading and sorry to go on a bit!

WM x x

willsmum_2

And here's my SOA, scary!!


Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details[/b]
Monthly income after tax................ 1000
Partners monthly income after tax....... 0
Benefits................................ 80
Other income............................ 550
Total monthly income.................... 1630
Monthly Expense Details
Mortgage................................ 447.4
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 110
Electricity............................. 120.5
Gas..................................... 0
Oil..................................... 0
Water rates............................. 46.39
Telephone (land line)................... 46
Mobile phone............................ 0
TV Licence.............................. 12.12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 160
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 10
Car Insurance........................... 12.84
Car maintenance (including MOT)......... 4
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 29.25
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 20
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1058.5

Assets
Cash.................................... 0
House value (Gross)..................... 155000
Shares and bonds........................ 0
Car(s).................................. 500
Other assets............................ 0
Total Assets............................ 155500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 78000....(447.4)....2.5
Total secured & HP debts...... 78000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Moorcroft (Orange).............156.23....10........0
Mortgage Arrears...............375.......100.......0
Link Finance...................1455......45........0
Halifax Overdraft..............250.......3.........16
NW Overdraft...................3461.49...50........17.9
Virgin Credit Card.............3523.59...90........34.9
Tesco Credit Card..............5928.12...25........0
Halifax Credit Card............2334......26........0
Total unsecured debts..........17483.43..349.......-

Monthly Budget Summary
Total monthly income.................... 1,630
Expenses (including HP & secured debts). 1,058.5
Available for debt repayments........... 571.5
Monthly UNsecured debt repayments....... 349
Amount left after debt repayments....... 222.5
Personal Balance Sheet Summary
Total assets (things you own)........... 155,500
Total HP & Secured debt................. -78,000
Total Unsecured debt.................... -17,483.43
Net Assets.............................. 60,016.57

The £550 other income is what my husband gives me towards the household bills. These are all of the bills that come out of my account and what I am "responsible" for.

rupe34

Hi Willsmum - well done for posting:T

People will be along with advice on your SOA if you want it - but I just wanted to say that you are doing great reducing your debt so far. PND is so horrible - glad you have come through it.

willsmum_2

Thank you Rupe. I thought no one had seen my post and I was going to be left all on my own dealing with the debt monster.

Could really do with someone looking over my SOA with a fresh pair of eyes if anyone is up to the challenge!

Look forward to your advice

WM x x

willsmum_2

Can anyone tell me about Default Notices? I have four :eek: and to be honest I don't know that much about them.

I know they last for 6 years on your credit history and that they completely destroy your chance of getting credit, but I am afraid that is the limits of my knowledge.

Any advice or insight into this would be really appreciated.

WM x x

willsmum_2

Evening everyone!

Sorry to bug you all, but can someone take a look at my SOA please??

Could do with a little shove in the right direction!

Thank you

WM x x

savingholmes

Firstly well done for having the courage to post. I know it is very scary posting an SOA as I did when I first joined!

willsmum wrote: »

And here's my SOA, scary!!
Monthly income after tax................ 1000
Benefits................................ 80
Other income............................ 550 Is it realistic that your OH only gives you this much? I ask as you seem to blame yourself for the debt...
Total monthly income.................... 1630
Monthly Expense Details
Mortgage................................ 447.4
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 110
Electricity............................. 120.5 This seems expensive - have you checked out moneysupermarket.com and uswitch etc via cashback sites like quidco to see if you could get it any cheaper. Since I joined - we have reduced our bills from £110 per month to £73
Gas..................................... 0
Oil..................................... 0
Water rates............................. 46.39 Do you have a meter? This seems expensive - we are metered and reduced the bill form £63 to £17 now a year later
Telephone (land line)................... 46 We used to pay £30 plus £18 with internet - now we are normally at £20-30 using Talk Talk - if you go to a company like them thro a cashback site like quidco then you can get paid up to £50 to save money. On some utility switches you can get paid up to £100 to switch on places like quidco
Mobile phone............................ 0
TV Licence.............................. 12.12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 160 This seems good - well done :T
Clothing................................ 0
Petrol/diesel........................... 40 wow
Road tax................................ 10
Car Insurance........................... 12.84 use cashback site next year
Car maintenance (including MOT)......... 4
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 29.25 I've got mine down to £17 from £56 this year Look into this. Try Martin's money makeover
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 20
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1058.5

Assets
Cash.................................... 0
House value (Gross)..................... 155000
Shares and bonds........................ 0
Car(s).................................. 500
Other assets............................ 0
Total Assets............................ 155500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 78000....(447.4)....2.5 Great interest rate but can't rely on it lasting... Need to plan now for it doubling next year just in case
Total secured & HP debts...... 78000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Moorcroft (Orange).............156.23....10........0
Mortgage Arrears...............375.......100.......0
Link Finance...................1455......45........0
Halifax Overdraft..............250.......3.........16
NW Overdraft...................3461.49...50........17.9 Second priority
Virgin Credit Card.............3523.59...90........34.9 Can you balance transfer this if not this is top priority
Tesco Credit Card..............5928.12...25........0
Halifax Credit Card............2334......26........0
Total unsecured debts..........17483.43..349.......-

Monthly Budget Summary
Total monthly income.................... 1,630
Expenses (including HP & secured debts). 1,058.5
Available for debt repayments........... 571.5
Monthly UNsecured debt repayments....... 349
Amount left after debt repayments....... 222.5 do you have this much left - if not try myspendingdiary.com to track your expenditure
Personal Balance Sheet Summary
Total assets (things you own)........... 155,500
Total HP & Secured debt................. -78,000
Total Unsecured debt.................... -17,483.43
Net Assets.............................. 60,016.57

The £550 other income is what my husband gives me towards the household bills. These are all of the bills that come out of my account and what I am "responsible" for.

I've made some suggestions above.

I don't know if you have found the snowball calculator at http://www.whatsthecost.com/login.aspx

You feed in all your debt info and it tells you waht to pay off first.... You can have a play around and see how upping your payment a little bit can knock loads off your debt free date

Another tool I have used is martin's demotivator - find out how much your repeat treats cost and try the reduce them

I joined nearly 18 months ago now and it has made such a difference to our lives... It took me a few months to finally get my lightbulb moment and I was so jealous of everyone else who found the site before me and therefore was further on in their journey. I wasn't sure then I would stick with it to this point but am so grateful I did.

So chin up, well done for facing up to things, and keep posting!

Different_Corner

Hi willsmum
I'm of no help whatsoever, but couldn't just read and run. It's hard doing this alone, and you've made great progress. Do you think DH has any idea of the debt ?
Have you signed up for any challenges ie £10 a day or a payment a day ? I'm pretty useless at them but others can really motivate and inspire.

As for defaults, someone will be along to clarify, I know I have collected a few along the way.
I too have high interest cards around the 30% mark and as saving holmes says the snowball calculator is like my bible.
Stick with it

willsmum_2

Hi Savingholmes and Different_corner.

As you can see I am an early bird too! My son gets up at 5 every morning so it is nice to know I am not the only person in the world who sees two 6 o'clocks in one 24 hour period.

I keep meaning to look on a comparison site for my gas / elec, but never know where to find the information they are after regarding consumption figures and all of that. However, if I could potentially save up to £50 a month, I must look into it tomorrow when I am not at work.

As far as my DH only paying £550 a month there are a couple of reasons for this:
1) He took out a loan for me (because I couldn't get credit) and pays £198 a month for the privelidge. He pays it every month and (hardly ever:o) complains about it
2) DH has three boys from another relationship and i will be damned if my stupidity with money means the boys suffer. Taking more money of my DH would mean taking money from them and that will never happen!!

Have used the snowball and at the rate I am going, I will be here until 2029!!! Not great news,, but at least it is not 2212 like it was!!!!

I know i have to start planning for then the interest rate goes up and my mortgage rockets, but at the moment I just want to get the bigger balances down. I completely agree that the Virgin card is the priority and since joining the '10 in 10' challenge, that will be my first mission!!

Thanks for reading and I look forward to speaking to you soon

WM x x

willsmum_2

Well I have managed my third NSD in a row and I am quite proud of myself!

I can't tell you how much less daunted I feel about my debts since I started writing this diary. It's just sort of puts everything into perspective which has helped me get my head around everything.

Thanks Savingholmes for pointing out which two debts I should be focusing on first it is what I had suspected, but it's done me a lot of good to hear it from someone else.

Because I am so pleased with myself for joining the '10 in 10' challenge for next year, I have decided to just pay off the minimum amounts owed in December and save any extra which I can put all together and make a decent sized payment to go out of my account on January 1st to start me off in a great way with my 2010 challenge. It would be great to think that i could start off the new year with a couple hundred quid going out of my account (if you know what I mean:rotfl:)

What strikes me the most is the way my attitude to money has changed so much since my LBM. I didn't think anything of putting anything on a credit card and if I was feeling a bit pants I would happily take myself off clothes shopping and spend £200 - £300 in an afternoon. Now I have a fit if the coffee in Tesco's has gone up 2p!!!

I wish I could tell DH just how much debt I am in. After he took the loan out for me a couple of years ago he just doesn't trust me with money (whereas before PND I was in charge of EVERYTHING). Now he opens every letter that comes through the door (many a time I thought i was going to pass out when the post man came to the door. Have even fell down the stairs trying to get the door before DH!!) as much as it hurts that he doesn't trust me, I know it is entirely my fault. Don't get me wrong, he is not an angel with money, but coming from a background where he had nothing he understands the value of money. Me on the otherhand was very spoilt as a child and I think it was that part of me when I started spending all the time.

Anways, looking forward, I need to do my Snowball tomorrow to find out what my DFD actually is so I can plan a bit better. And look at switch the electricity and gas.

Well, I am off now so I will speak to you all tomorrow.

WM x x

willsmum_2

Well today hasn't been the great debt sorting day I had hoped it would be and to be perfectly honest, it is all my bloody mother in law's fault (don't even go there!)

DH is off tomorrow so doubt I will get much done then either. Really must get my snowball done asap!!!

WM x x