Please advise me on my Dept Problem. Thanks

channic3

Hi, I wonder if somebody can give me some advise as I am in a real mess right now.
I am currently in about £12k worth of dept and I feel deeply ashamed and angry at my self.

I am working and have been doing so with the same directors for the last 9 years and I have never been in this situation before. The problem started last year when my salary was reduced by £10k a year because the business was very slow and currently still is. I know that you may think I am crazy to still be here, and I guess I am, however please understand that I have known everybody very well for many years and also in my role I currently earn commission on top of my base. The problem is that there is very little commission to be earned at the moment, and I have stayed with the company only because I was assured that things will pick up, and I had no reason to doubt them as I have seen the business go through a bad patch and always pick up later.

I have asked my directors for more money as I also have a family and mortgage to pay, but even though I have asked time and time again, I get now answer or I am given the run around and it goes to show that you can not trust anyone, and being loyal and sticking around for others can be a dangerous thing.

Ok thats over here is the dept problem,

Loan £7500 which I took out a year ago for home improvements (now £5200 remaining)

Credit Card 1 £4000k (maxed out, this is how I have been surviving since my salary has been dropped)

Credit are 2 £2800k (same as above)

In addition I also have an Overdraft on my current account and I am currently about £500 overdrawn.

I know that this is completely stupid from my part to allow this to go on for so long, I have always been good with credit and never had this problem, until my pay check got slashed.

Please everbody, I really don’t need a lecture, and I am now actively looking to get out of this company asap and I am also prepared to take on part time work just to clear this dept off as quickly as possible.

Here is my current problem, based on the above dept and the current income I receive, am no longer in a position to pay my creditors in full as I have been doing. I am dreading the fact that I can foresee them writing to me and I don’t know what can happen from there.

Sorry for the essay, it is just I have been building this up for a while now and needed to give an insight on my dilemma.

Any advice will be appreciated.

Tixy

Hi

I'd suggest you start by completing a statement of affairs of your finances. We use this calculator - http://www.makesenseofcards.com/soacalc.html Completing that should show you how far short you are of being able to make your repayments and that will then help decide what is the best options for you.
If you post the SoA on here people will take a look and see if we can suggest ways you can up your income or decrease your outgoings so that you can meet your debt repayments. If you cannot make sufficent changes then you may need to consider a DMP or similar where you would pay less to your debts but that would have a massive impact on your credit files.

Might also be worth a read of Trev's guide here - The Big Guide to Becoming Debt Free

GreatGable

I'd like to just say that as bad as it seems, I think your situation isn't perilous but it is good that you're facing it before if becomes too damaging.

If your £10k wage drop is not going to reverse anytime soon then you need to really look at your expenses and revise accordingly - even more minor expenses can really add up. Example, I used to buy a coffee for the train most mornings at £2.60 a day. Giving that up saves me about £500 a year. Etc etc. Savings can usually be made, and the effects can be dramatic.

You are not alone!

arthursleep

I guess whilst there is no change in your wage for now you need to look at reducing your outgoings.
You really cannot sustain he same spending earning 10k less as you are finding out.
Have you completed an soa ? Maybe we can suggest some cutbacks.

KingElvis

If you wage drops, you need to drop your spending too.

Good luck.

Marine_life

Let me ask a question - did everyone else take a drop........including the directors?

How many people in the company?

Most businesses recovered in 2010 so if you wages have not yet recovered you may begin to question when they will.

gettingbackontrack

GreatGable wrote: »

I'd like to just say that as bad as it seems, I think your situation isn't perilous but it is good that you're facing it before if becomes too damaging.

......
You are not alone!

I'm not an expert so I can't really offer any advice, but i just wanted well done on having that light bulb moment (wish i'd done that when my debt was £12,000....) and that they comment above is excellent.

Good luck on your debt-free journey.

channic3

Thanks for your reply gettingbackontrack.

For your information no, nobody else has the same implication as myself, I worked with them before in another company when they started out on their own venture. I was the first member of staff with them. I stayed up until the very end, until the business was sold in 2009. Since then they started immediately with another venture, and although we all worked very hard and were rewarded for this, I now see that this is not likely to happen again. I will start over and won’t forget this experience. I just hope my creditors will look at me favourably for coming clean before I start defaulting?

RAS

Hi

Irrespective of the work situation, please can you put up an SOA and we may be able to help you with the debt situation.