Newbie on Debtfree - any suggestions anyone?

dbushes

Good afternoon tm4of,

Thanks for your response and your excellent suggestions. As I said to Pebblespop there is a lot of support and I already feel part of the community.

I will be looking at all of the suggestions made with a fine tooth comb. With regard to clothing I have far too much to need anything now but if I do then I will have to save for it. With regard to the holiday - bam - that's moved to my debt.

Have a great one.

Hannah_10

Mobile Phone Bill - Shocking! I would think £25 should be enough for anyone, get a free calls package on your landline for £5 extra a month (consider swapping landline providers if necc) and get a mobile phone with unlimited texts. Even on PAYG unlimited texts is £30 a month, so expect it for £20 on contract. Then stop using the mobile for calling and stop calling mobiles at all- just text. Your mates will understand if you tell them you've got money difficulties, anyone that doesn't wasn't a mate.
Car Insurance- Not good, you wanna see about £30 there too, if that. If it can't be done consider if your car is in an excessively high group and if you'd be better off changing it. You can sometimes cancel your car insurance too, check the small print to see if you'd be out of pocket much doing this. For example if it will cost £40 to cancel and you'll save £200 a year by going with a new insurer then £160 is a rich payback for your time.
Satelite TV- You don't need this, you just want it. Have a rethink.
Medical- What is this? Perhaps there are safe ways to reduce it (eg ask the Dr for a prescription for 6 weeks or 2 months pills not 4 weeks please, get glasses for £8.50 a pair not contacts at £13 a month and so on).
Holiday- Can you afford it? Do you need it? You need to ask yourself some tough questions.

Even if you do all of the above you're only going to claw back about £150 a month. I notice you've got zero for clothes, haircuts, presents and entertainment. I don't believe that, I think perhaps you are just not accounting for it. If you don't really know where your money goes then you need to do a spending diary for a month or more. Basically you write every penny that leaves your hands in a cheap notebook, be that 2p in the guide dogs box or £200 for tyres. The lot.

Even if you make the savings in paragraph one then paragraph two might knock it for six! This is a tight rope you're walking here. There isn't a clear salvation. You saying you're going to get more income is good, there is a board here for raising your income perhaps give it a read. The thing I fear is that you will reign yourself in too tightly and you'll rebel under the pressure.

For that reason I think you need to give thought to another strategy, not just snowballing (paying off high rates first). I would like you to talk to CCCS or another charity about the pros and cons of a debt management plan. Not with a view to jumping into one, but just so you know what would happen if you decided to do that instead. How your credit rating would be affected, if the interest can be stopped, how long it would take and so on. Talk it through so that you at least understand it and then if snowballing gets too much you are less likely to have a great big kick-off blowout and more likely to turn towards something sensible.

A DMP isn't your first port of call. Tarting (shifting debts to better interest rates) and snowballing are Plan A, but Plan A has very little breathing space at all. It wouldn't suprise me to find you only truly have £50 a month spare no matter how hard you econonmise, so for tarting&snowballing to work for you a second job and utter frugality are a must.

happycamel_2

Hi, advice you've received so far is excellent and there's not much more I can say except good luck and post on here if you ever feel you're flagging.

Given the high interest rates on the cards see if you can get a 0% transfer (check the T&C). It might even be an idea to get a personal loan at a lower rate to pay them off (check its flexible and you can overpay). The guys over at the credit cards and loans boards would be of help.

You've got good spare income, it just needs to be going on capital not interest and without wrecking your credit rating.

Good luck

x.nukke.x

Hi :wave:

Nothing of any real use to say, just wanting to wish you good luck! Well done on making a start!

bargainbetty

I echo the comments about trying to get the interest rates down - these are going to cripple your efforts!

I woudl try a low-life-of-balance first - the rate is reduced and fixed, but not 0%, so you get one a little more easily than the real premium 0% cards. If you get one, transfer everything you can off one card onto it. If you can empty the card fully onto other cards, even better.

When you have an empty card, call the provider and ask for a balance transfer deal. You already have the available credit, you are just going to use it differently! If you get a good deal, use it to pay off the highest interest rate possible, and so on.... you could, in theory, tart your existing cards about to get the lowest possible rates. You do incur 3% transfer fees, but the reality is you probably lose that in interest every two months as it is.

Get them all as low as possible, then cut the !!!!!!s up. Close off the cards as you clear them, and don't be tempted to open more!

You still have the minimum payments to meet, but at least you will be paying real money off each month!

All the best,
x

dbushes

HI Hannah_10,

Will admit had a bit of a cry. I hear and accept everything you have said and will immediately say thank you. Not what I wanted to hear but what I needed to hear.

I will be dedicating a day over the weekend to looking at all the points you have brought to light and will get back to you and everyone else who has taken an interest in a newbie (that would be me lol).

Watch this space. I will be back with further updates.

dbushes

To happycamel, barginbetty and x.nukke.x,

Thank you so much for your messages. As you can see from my message to Hannah_10 I am grateful for the advice given so far.

Happycamel/Barginbetty - I will take a look at the creditcards over the weekend and see if I can change them to 0% or lower lifetime rate. Are there any letters available to ask for lower lifetime rates? I will check on the credit card board to see if there are any.

I have already accepted this challenge and will do everything in my power and resources to be DF.

Thanks again.

*Jellie*

Welcome dbushes.
I'm not so great looking at the figures but will add what advice I can.
1. Keep a spending diary and start budgeting
2. Analyse spending weaknesses and habits. You need to address these issues to stay on track as a DFW.
3. Use the boards here and challenges to keep you going. Maybe start a diary too. I found one major problem of mine was splurging to treat myself on certain things. I had to break the habit and find other positive things to do when I felt like spending. If you know supermarket shopping could be reduced head over to OS board

Good luck!

dbushes

Hi Jellie

Thanks for you post and the advice. Am beginning a diary today which should make interesting reading.

Watch this space cos changes are happening.

Bx

dbushes

Hi Hannah_10,

Well today I am going to get started on my spending diary. Cheap note book check (didn't even need to buy one found something that would do), pen check and the drive to pay off my debt CHECK. This should make for interesting reading.

I also got started on my budget today.

I looked already looked at the tv package and have saved £19.50 per month and a tv/telephone/broadband package. This will go directly onto my debt as it's money I didn't have before so will not miss it now.

Hope to have an major update before the end of the weekend but thought I would let peeps know what I'm up to.

Thanks for the support and ideas.

Bx