Newbie - Finally getting myself sorted!

pms

Hi there,

Oh how I wish I had found this site along time ago!
I realise now I'm not the only one in the position I'm in and there are people alot worse off than I am.

I am 28 years old and live in Edinburgh. I got my 1st credit card at 18 years old and it was the worst mistake of my life.

Like many people if I wanted something I used the card when I could not afford to pay for them with cash.(I'm useless with money!) After a year or so I ended up with 2 credit cards both totally maxed out, in a state and eventually broke down in tears when I couldnt keep up with thte repayments anymore and thankfully my parents bailed me out, they also said if I did it again they wouldn't help me next time. I took out my 1st loan to clear 1 of the cards at this time.
I stupidly didn't cut the cards up and over the next few years hit near the maximum limit on them yet again and aquired not 1 but 2 different loans to pay them off. I bought a car on HP last year as the car I was driving (Dad's) was being sold and I didn't like it to drive. I also moved out of home and in with a friend. To help pay for food, and fuel for my car I began putting more and more on the credit cards and finally again maxed them both out. I knew my parents would go balistic if they found out so I never told them I even hid it from my flatmate until one night she confronted me about money for food that she had paid for which I owed her something towards, again I broke down I just felt so embarrassed about it all.

By this point I had been in touch with an Insolvency Practitioner and the wheels were in motion for a Protected Trust Deed (the Scottish equvilent to an IVA) to be set up.

My Debts until then were as follows:
Lloyds TSB Credit Card £6,598
Lloyds TSB Loan £2,088
Lloyds TSB Overdraft £ 450
Royal Bank of Scotland Credit Card £4,599
Tesco Loan £6,824
Car HP £2,960

A grand total of £23,519



My salary is around £1000 a month and I was spending

Rent £250
Food £125
Car repayments and fuel £150
The rest was going on my loans and credit cards which I was srtuggling to meet minimum payments, so really had no money for me.

On top of everything I have had to change my bank account to a basic account, which hasn't been so bad, I just miss my cheque book!
In February this year thankfully my parents agreed I could move back home, they know I have money problems just not the extent of it all. In March I signed the Trust Deed and it took a huge weight off my shoulders. Thankfully I have been allowed to keep my car. Although for a month or so I was still getting phone calls from my creditors and letters threatening legal action, my Trustee has been brilliant and has delt with it all. For me at the time it was the only way I felt I could get myself out of a huge mess.

I cannot have a savings account to save for anything as it is seen as spare money that my creditors should have which is a bit annoying and I am currently toying with the idea of telling my parents and seeing if they would open a simple savings account with a passbook so I can put money away for car maintanence and car tax, as this has not been put down in my money allowance set out in my Trust Deed. I really have no where to hide the extra money to stop myself spending it!

I'm just really scared about taking that 1st step with my parents and telling them what I've done.

At least I know that come March 2009 I'll have no debt left and all the money in my bank account will be for me.

steve_cov

Never mind that you got here a bit late! You're here now, and you seem to be making really good progress.

You'll be barely 30 before it's all cleared, and I know there are loads of people here who would love to be in that position! Chin up.

CLAPTON

do you want to say what your financial details are? how much is your trust deed, why wasn't your car expenses put down as part of that...what exactly are you saying?

pms

My salary is around £1020 a month and of that I am paying

Trust Deed £320
Digs £200
Car HP £76
Fuel/maintanence £80
Tax £10
Insurance £30
Mobile £54
Prescriptions/dental/optical £30
Clothes £30
Cinema card £11
Household £160 (this included toiletries and any food I want for lunches at work, I do tend to take lunch each day which saves me money. Also my boyfriend lives in England so I spend money on flights down to see him as its cheaper than driving.)

My car wasn't included in the Trust Deed as I use it to get to and from work, which in the terms of the Trust Deed is acceptable.

The amounts I have put down are what has been laid out for me by my Trustee. My big problem is trying to save what I dont need to spend and to try to save it somehow which I find extremely difficult. My cinema card is also a life line as I love the movies and I pay a monthly fee of £11 and can go as much as I want to. I tend to go at least once a week so it saves me money as I usually take a bottle of water in with me as well so don't have to buy there as the prices are a rip off.

pounds_and_pensive

It might actually come as a relief to your parents once you've told them. You say they know you have money problems, but not to what extent, so they could well be worrying unnecessarily that you're in seemingly insoluble financial trouble. Even if that isn't the case, there's a big difference between being confronted by someone who's broken down in tears of desperation and someone who admits to being in difficulty but is confidently pursuing a sensible plan to resolve it.

I'd imagine that calmly being asked to become part of that plan by opening a savings account for you with your own money probably imposes no burden at all in comparison to wondering if you're going to be carted off in the dead of night by a posse of irate loan sharks, or wondering whether you'll still be living at home with them when you're fifty Take a deep breath and tell them - I'm not saying it's going to be easy, but it probably won't be as difficult as you think.

Good luck

pms

Its just plucking up the courage to tell them thats scaring me!

msmicawber

I don't understand what you're asking either - it looks as though your outgoings are £676 and your income is £1,046, leaving £370. What does the £370 cover? Can you get your car serviced one month, MOT'd another, insured another, and taxed in another?

If the above isn't possible, can you not go back to the company and ask them to vary the trust deed to allow you set aside money for car maintenance, etc?

As for your parents, take a deep breath and tell them. They love you and will want to support you and will probably be shocked, but will also be pleased that you're taking responsibility for your problems and are dealing with it. I'm a parent myself, and would hate to think that a child of mine was suffering in silence.

pms

I dont go out all that often to the pub and such. I have at least 1/2 birthdays a month that I buy for. I travel around following speedway, although I have reduced this drastically this year which has been really difficult, I tend to stick to home matches and maybe 1 or 2 away matches a month at most which costs about £15 each time. Home matches are ok as I have a season ticket. I also travel to see my boyfriend regularly and he comes up here also.
I generally pay for things like my food for work and clothes where needed and prescriptions from which at the moment seem to be at least twice a month sometimes more than 1 item at a time.

The thing with my car is everything seems to come at once all in the same month, although I have taken out a 6 monthly road tax to try spread it out a bit I will hopefully have enough to get a yearly one when it need renewed. I dont use all my fuel allowance or my phone bill allowance every month its just trying to save it I guess is my problem. At the moment I am also paying for a holiday that a group of friends are going on with myself and my boyfriend, so that is taking up quite a bit of money. I sometimes don't even know what I spend my money on.

CLAPTON

I would suggest that you post your ACTUAL budget rather than one created for the trust deed.
i.e. one that includes holidays, birthdays , following speedway, flights to see OH, clothes, going out etc.
if you dont know where your money goes, start a spending diary and write down everything you spend
once you have created a real budget you will be better placed to see where saving can be made.

Cerenia

Have you thought about the train for travel as well? If you book train tickets like, a month- 6 weeks in advance, you can get them pretty cheap, works out better than driving!

pms

CLAPTON wrote:

I would suggest that you post your ACTUAL budget rather than one created for the trust deed.
i.e. one that includes holidays, birthdays , following speedway, flights to see OH, clothes, going out etc.
if you dont know where your money goes, start a spending diary and write down everything you spend
once you have created a real budget you will be better placed to see where saving can be made.

Thanks for that I never thought of starting a spending diary will do that as of my next pay day.