Do you think it will get better?

NellyM029

Hello,

Just to let you know that I am 31 and spent the last 10 years accruing credit card debt. I could kick myself now, but I sppose what is done is done.

I used to see credit cards as free money and then I saw them as tools to live on when my outgoings (credit card bills and loan) inceased - the horrible debt cycle!!!

Last July, I realised I couldnt continue hiding my head in the sand with my debt. I went to the bank who helped me set a strict budget of £350 a month to live off - petrol, food etc. I am just surving on it (petrol keeps on increasing and I spend over £100 a month). I always pay my bills (but can only afford minimum amount - which takes almost half my salary)

The thing is, I dont feel in a better position since July. The minimum payment doesn't make a dint in my debt
I think I have achieved somethng e.g. I haven't used a credit card in months, I managed to get a credit card to reduce my APR...

But then another card increases my APR :mad:. And with Petrol price inceases, food price increases etc it all make it that bit harder each month.

I was hoping to increase my minimum payment to credit cards by now, but I dont seem to be able to.


I am however pursuing one card for missold ppi.

Anyway, my question is does anyone think it can get better? Not just my situation personally, but does anyone have any hope that the cost of living petrol etc will improve?
Thanks

katsu

You can refuse the APR increase as long as you agree to stop using the card - check out the tabs at the top of the site for more information on how.

Can you up your income - take a second job for a whole to decrease your debts?

I think things will get better when the economy gets better. If you post an SOA people can offer advice on where you could make any more savings to increase your repayments.

DarkConvict

You have fallen into a cycle that many people find very difficult to see until they hit it themselves.

You can reject credit card interest rises but have only a short timescale to do so - http://www.moneysavingexpert.com/reclaim/credit-card-interest-rate-increases

If you are paying only the minimum payment you are looking at about 40 years to have paid off the balance, try putting in your debts in this calculator - http://www.whatsthecost.com/snowball.aspx

Cutting down to £350 a month is very good especially as £100 is now fuel costs. Due to inflation costs are only going to rise and no government is planning to lower fuel tax so do not expect it to get any better.

If you want more detailed advice we need to know your circumstances in detail, so post up an SOA - http://www.makesenseofcards.com/soacalc.html

However you should at the very least contact 2 of these debt charities, a DMP or maybe even bankruptcy maybe the best option if your debt free date is over 10 years. Charities - https://forums.moneysavingexpert.com/discussion/2077631

NellyM029

I've only just realised today thatthe APR has been increased...ggggrrrr but will try to reject it.

A second job is difficult for me - I work about 40-50 hours a week I travel to and from work which is 1 hour each way. I try to get overtime when I can although they are freezing overtime in June.

I will do the SOA thanks!

NellyM029

Hi Darkconvict,

Thanks for your advice part of my job requires me to pass a credit check as I handle sort of personal/sensitive data so I could lose my job with bankrupcy etc, that sounds also like a very last chance option..

Will get on the SOA.

DarkConvict

Yep some jobs like finance law and any requiring some type of security clearance can be affected. If this does apply to you it will be the long haul in order to save your career.

But even those sensitive jobs may require you do not default on debts meaning a DMP is not suitable either, which is the last line in tackling debts. In those circumstances you may have to do the wrong financial decision which is to consolidate debts (which is wrong for 99% of people as it increases debt overall) but it may allow you to keep your job. It all depends on circumstances.

The charities will generally give the best advice.

NellyM029

Hi,

Yeah I have never defaulted, missed payment etc only issue was when I had 2 months worth of bank charges last year - hence the visit t the bank in July.


I have filled out the SOA. I'm currently house sitting for a friend so some of this is a (accurate guess) - But I missed out £5 a month to pay for my account and approx £2 a month is paid for the pleasure of my £750 ovedraft.
I currently rent a room hence the cheap bills but this isn't guaranteed past August as my landlord is emigrating in August, lucky fella.

There is money left over e case but I have used this for unexpected stuff like my car breaking down, expenses that take ages to get back when I travel with work. I also need to consider saving for when I move out.


Monthly Budget SummaryAmount(£)Total monthly income1,570Monthly expenses (incl. HP & secured loans)713.33Available for debt repayments856.67UNsecured debt repayments694.5Amount left after debt repayments162.17

Personal Balance Sheet SummaryAmount(£)Total Assets (things you own)1,000Total Secured & HP Debt-0Total Unsecured Debt-36,392Net Assets-35,392
Household Information

Number of adults in household2Number of children in household0Number of cars owned1
Income, Expense, Debt & Asset Details

IncomeAmount(£)Monthly income after tax1570Partners monthly income0Benefits0Other income0Total monthly income1570

ExpensesAmount(£)Mortgage0Secured/HP loan payments0Rent310Management charge (leasehold property)0Council tax1Electricity1Gas1Oil0Water Rates1Telephone (land line)0Mobile phone22TV Licence1Satellite/Cable TV0Internet services0Groceries etc.120Clothing15Petrol/diesel120Road tax11.33Car Insurance15Car maintenance (including MOT)10Car Parking0Other travel0Childcare/nursery0Other child related expenses0Medical (prescriptions, dentists, opticians etc.)0Pet Insurance/Vet bills0Buildings Insurance0Contents Insurance0Life Assurance0Other Insurance0Presents (birthday, christmas etc.)20Haircuts15Entertainment50Holiday0Emergency Fund0Total monthly expenses713.33

Secured & HP Debt DescriptionDebt(£)Monthly(£)APR(%)Mortgage0(0) 0Secured & HP Debt totals0- -

Unsecured Debt DescriptionDebt(£)Monthly(£)APR(%)loan21000352.59credit card75001706.9credit card 240009014.9credit card 42450454cediit card 314423726.9Unsecured Debt totals36392694.5-

Asset DescriptionValue (£)Cash0House Value (Gross)0Shares and bonds0Car(s)1000Other assets (e.g. endowments, jewellery etc) 0Total Assets1000

NellyM029

Okay, any advice on how on earth you paste the SOA??

D'OH!

NellyM029

Okay got it:

<pre><b>Statement of Affairs and Personal Balance Sheet</b><b>
Household Information</b>
Number of adults in household........... 2 - live in landlord
Number of children in household......... 0
Number of cars owned.................... 1<b>
Monthly Income Details</b>
Monthly income after tax................ 1570
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0<b>
Total monthly income.................... 1570</b><b>
Monthly Expense Details</b>
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 310 - includes bills I rent a room.
Management charge (leasehold property).. 0
Council tax............................. 1 - had to put 1s in so it would accept my add but it is included in rent
Electricity............................. 1
Gas..................................... 1
Oil..................................... 0
Water rates............................. 1
Telephone (land line)................... 0
Mobile phone............................ 22 - have no other access to phone or internet
TV Licence.............................. 1
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 120
Clothing................................ 15
Petrol/diesel........................... 120
Road tax................................ 11.33
Car Insurance........................... 15
Car maintenance (including MOT)......... 10
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..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 15
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0<b>
Total monthly expenses.................. 713.33</b>
<b>
Assets</b>
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 0<b>
Total Assets............................ 1000</b>
<b>
No Secured nor Hire Purchase Debts</b>
<b>Unsecured Debts</b>
Description....................Debt......Monthly...APR
loan...........................21000.....352.5.....9
credit card....................7500......170.......6.9
credit card 2..................4000......90........14.9
credit card 4..................2450......45........4
cediit card 3..................1442......37........26.9<b>
Total unsecured debts..........36392.....694.5.....- </b>
<b>
Monthly Budget Summary</b>
Total monthly income.................... 1,570
Expenses (including HP & secured debts). 713.33
Available for debt repayments........... 856.67
Monthly UNsecured debt repayments....... 694.5<b>
Amount left after debt repayments....... 162.17</b>
<b>Personal Balance Sheet Summary</b>
Total assets (things you own)........... 1,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -36,392<b>
Net Assets.............................. -35,392</b>

DarkConvict

Your rent and bills are nice and low, which is good.

Groceries 120 - Some people can do this at under £60 for 1 person, so i would reckon you could get to £80-100. At least save a bit there.

Clothing 15 - Buy only what you need when clothes wear out, so drop this down to either 0 or 5.

Petrol 120 - Can this be lowered with less driving or more economical driving, can you fuel up at a supermarket instead of say ESSO/Shell?

Presents 20 - Drop to 5, close family only.

Haircuts 15 - To high, can a local collage in your area do it cheaper, or maybe just get the hair cut short then wait for it to grow. I had my hair cut in January, and going to get it cut tomorrow. Though I am a student so i can get away with it more. That is £9 over 4/5 months for me.

Entertainment 50 - Way to high, drop to no more than 10.

I reckon there is between £70-120 savings you could make per month. Not alot but with £32,000 of debt it all counts.

Using snowballing i get the following figure. http://www.whatsthecost.com/snowball.aspx
Debt repayment figure I used was £1000 a month, that's just over what you can afford. And 2% as the min payment figure.

It will take you 39 months to pay off these debts if you snowball correctly. During that time, you'll pay £4,854.00 in interest.

If you paid the same amount per month, but changed the order in which you paid your debts so you weren't paying the highest interest rates first, it would cost you an additional £1,794.00 in interest.

Hope that helps

NellyM029

Thank you dark convict - I will take as muc f your advice as you can. Spent £45 this week and hoping that will last me for two weeks !

£60 a month is amazing!