Please help: Debt keeping me up at night and dont see an end in sight

britchic

I have a number f debts that I am strugglng to clear abd need some advice on the fastest way to do it.

I make 2K a month and have the following debts;

• 2K overdraft which is at it's maximum
• 2 credit cards each with 5K each on them and high interest rates for which I pay the minimum each month
• a personal loan with 11k remaining and payments of 300 a month
• all other other outgoings come to approx £1500 a month

Does anyone have advice on how to begin to clear the credit cards and my overdraft? I have heard that getting a new bank account and paying the overdraft on the old account is an option. Does anyone have any experience of this?

These debt problems are keeping me awake at night and would appreciate any advice or tips.

Baggiebird1nil

Post a statement of affairs (SOA) (i.e. incomings and outgoings and some of the board experts will be along to help you. Been there myself but have now been debt free for 9 whole days!

GeorgeUK

Yup, we need to see a statement of affairs to see if there are any savings you can make in your expenditure.
https://www.makesenseofcards.com/soacalc.html

If you have not had CCJ's, defaults or late payments, there will probably also be some things we can try on the cards. We need more details though. Please try to make the SOA as accurate aspossible - what you are spending rather than what you think your should be spending.

Tixy

Hi and welcome

First starting point is a statement of affairs http://www.makesenseofcards.com/soacalc.html which will show you and use what money you should have left to start paying off your debts.

Setting up a new seperate bank account can be quite a good idea, especially if you are the sort of person who keeps dipping back into the overdraft or just keeps spending until your card is refused at the atm.

Then if you post the SoA up here we can see if you can make any savings/cutbacks to your expenses and suggest a plan for paying off your debts.

britchic

This is my Statement of Affairs (all monthly)

Loan - 350
Credit card 1 - 150
Credit Card 2 - 200
Phone - 50
Car Insurance - 42
Health insurance - 37
Mum and dad rent - 125
Card insurace - 16
Food - 300-400
Travel - 80
Petrol - 50
Yoga - 80

plus
Overdaft charges - 22 every 5 days i'm over my overdraft limit
something called month end charges which appeared last month as £150 on my bank statement

This is without any social outings or engagements.

Any help would be greatly appreciated!

Tixy

Hi
Can you complete the form in george's link so we can see all the details of the APRs etc please.
You need to account for car tax, car maintenance (mot, servicing, tyres etc) and to budget for things like clothes, haircuts, presents etc and a little for entertainment etc.

Your food cost looks really high -what is included in that? typically for one adult the cost is around £100 per month.
What are travel costs in addition to the car?

dancingfairy

You might want to keep a spending diary as your outgoings don't seem to add up to the 2k you say you've got coming in each month.
I think your first priority has to be to sort the bank account out -those charges are ridiculous.
Your food is also pretty high - do you buy food for the whole family as your contribution? or is this lots of eating out with friends etc?
Phone is also high too - is this a mobile? contract or PAYG? whatever it's massive - if it's a mobile you need to get on to them and get yourself on a lower package with more minutes/texts - the market is competitive and you should be able to pay 20 pounds a month or less.
df

britchic

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 4
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2000
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 125
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 50
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 100
Petrol/diesel........................... 50
Road tax................................ 35
Car Insurance........................... 42
Car maintenance (including MOT)......... 50
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...................... 0
Life assurance ......................... 0
Other insurance......................... 37
Presents (birthday, christmas etc)...... 60
Haircuts................................ 0
Entertainment........................... 100
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1129

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 3000

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Credit card....................5000......125.......16.9
Credit card....................5000......125.......16.9
Loan...........................11000.....309.......0
Total unsecured debts..........21000.....559.......-

Monthly Budget Summary
Total monthly income.................... 2,000
Expenses (including HP & secured debts). 1,129
Available for debt repayments........... 871
Monthly UNsecured debt repayments....... 559
Amount left after debt repayments....... 312
Personal Balance Sheet Summary
Total assets (things you own)........... 3,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -21,000
Net Assets.............................. -18,000

Reproduced on Moneysavingexpert with permission, using IE browser.

Idiophreak

My thoughts in red:

britchic wrote: »

This is my Statement of Affairs (all monthly)

Loan - 350
Credit card 1 - 150
Credit Card 2 - 200
Phone - 50How long left on contract? When can you switch?
Car Insurance - 42Does this include tax, maintenance and the rest?
Health insurance - 37Could you live dangerously for a while?
Mum and dad rent - 125
Card insurace - 16As in credit card?
Food - 300-400Can definitely cut here - look at the Old Style board on here for some cheap recipe ideas
Travel - 80
Petrol - 50
Yoga - 80If it were me, this would have to go - you can do yoga in your living room for a few months to stay flexible - and I think the relaxation side could be tackled by sleeping better at night...

plus
Overdaft charges - 22 every 5 days i'm over my overdraft limit
something called month end charges which appeared last month as £150 on my bank statement

This is without any social outings or engagements.

Any help would be greatly appreciated!

dancingfairy

According to your SOA you have 312 a month spare - clearly this is not the case so a spending diary will really help and no doubt some of it is eaten up in all those extra charges. I think I would get a new bank account (not connected to anyone you owe money to as banks can do use money in current accounts to pay off credit card bills) and then set up a repayment plan with your old overdraft.
You have a healthy income and live at home so outgoings are less than if you lived out so you should be able to make some decent inroads into that debt.
Good Luck
df

pixiechick_2

britchic wrote: »

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 4 who does this consist of?
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2000
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 125
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 50
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400 way too high - unless you pay for all the family's food on top of the rent you pay - and even then it's stilla little high.
Clothing................................ 100 You should definitley be able to cut down on this!
Petrol/diesel........................... 50
Road tax................................ 35
Car Insurance........................... 42
Car maintenance (including MOT)......... 50 quite high
Car parking............................. 0
Other travel............................ 80 what is this for?
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......................... 37
Presents (birthday, christmas etc)...... 60 this could bbe cut down
Haircuts................................ 0
Entertainment........................... 100 and so could this!!
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1129

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 3000

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Credit card....................5000......125.......16.9
Credit card....................5000......125.......16.9
Loan...........................11000.....309.......0 what is the loan for?
Total unsecured debts..........21000.....559.......-

Monthly Budget Summary
Total monthly income.................... 2,000
Expenses (including HP & secured debts). 1,129
Available for debt repayments........... 871
Monthly UNsecured debt repayments....... 559
Amount left after debt repayments....... 312
Personal Balance Sheet Summary
Total assets (things you own)........... 3,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -21,000
Net Assets.............................. -18,000

Reproduced on Moneysavingexpert with permission, using IE browser.

Even with the quite high spending on some things you still have a surplus of £312 a month so you should be able to be paying your overdraft off at least. I think a spending diary would be a good idea. Write down everything that you spend. It's surprising how money disappears on 'small' things eg magazines.