Sorry old chap, the money has run out!

turbo.jet · 20 September 2011 at 9:53PM

Tony, I found the page which you should read which might help you with that Barclaycard phone call you are going to make -

http://www.moneysavingexpert.com/cards/cut-credit-card-interest

Hope it helps

hp48910 · 20 September 2011 at 9:56PM

Just checking in, sounds like you're steaming ahead with your budget plans, well done. Sorry to hear you mis-calculated your shopping budget, could you perhaps scale down a little to bridge the gap? If not, it sounds like your wife may have available funds to contribute.

I know it doesn't work for everyone but mine and my husband's finances are in one big pot. Our wages go into an account in which we leave the amount needed for bills. The rest is transfered for other purposes and commitments etc. I know it is a preference for some couples to have their wages separate and to each contribute to the household finances but it may work for you in the short term at least if you merge the funds. It will allow your wife to see exactly what comes in and goes out and where savings could be made.

Keep up the good work, it's great to read your continued determination.
H

chevalier · 21 September 2011 at 6:27AM

i think that you have done well to stop the rot before it got worse. there is nothing worse than haveing your choices taken away from you. that is what more debt would do to you. have you shown yoru OH the SOA. maybe she needs to see it in black and white how bad it is
chev

tony_ack · 21 September 2011 at 11:00AM

Okay then, a little story from our debt-laden past, which may hopefully explain why my and my partner have handled our own budgets up to now...

Back in 2007 we decided to set up a new joint bank account in both out names. The idea was that the new account would cover all the household bills and food shopping, and we would both pay a fixed amount into it every month. Any money left in our own current accounts could then be used to either spend on ourselves our pay off our overdrafts.

I started the process of shifting monthly payments from my account to the new account. I started with the standing orders first.

Then to complicate things, right in the middle of all this we moved into our first house which we'd bought. We actually spent very little on new stuff as we'd been renting an unfurnished property together for the previous year. Just after we moved in in August, we did some food shopping - I think it was only £30 worth, but with all the chaos and bills flying around, we didn't realise that this would leave us slightly short in that account, and we didn't have an overdraft. When all the dust settled, and everything cleared we ended up £6 overdrawn.

We didn't get charged straight away, and so we assumed that we had a small buffer. As soon as we could afford it (about 10 days later) we brought the account back into credit, and assumed that was that. Later that month we were hit with £50 in charges for going overdrawn (the irony was that there was a buffer but only up to £5, and we were £6 overdrawn). We couldn't afford to pay the £50 in charges, so I rang them straight away. I was told that it was basically tough that I had been charged and it wasn't the bank's policy to refund charges. I explained that I couldn't afford to pay, but I was told again that it was tough.

When I finally got paid we paid off the charges and brought the account back into credit again. The problem was that the charges from the previous month had sent us overdrawn for 3 weeks, so a short while later we were charged a further £50 charges for the charges that had sent us overdrawn! Which of course sent us overdrawn again!

This cycle continued for a couple of months - we could not afford to pay enough into the account to pay back the existing charges, and then to also cover future charges as well. In November I contacted the bank again and was put through to a haughty young fellow who was no help whatsoever. I pleaded down the phone with him to at least freeze the charges. When he refused, I asked him whether he thought it was fair, to which he replied 'well, I would handle my money better, SIR'. I explained that I couldn't afford to pay off the charges and then put enough money into the account to cover future charges without going overdrawn again, so the cycle would just continue on forever, to which he smugly replied 'well, that's not my problem'.

It was hopeless. We were trying to keep afloat but this account was costing us £50 per month, and we couldn't keep up. By now we had already abandonned the joint bills account idea, and were treating the Alliance and Leicester account as a very expensive debt.

Over Christmas, we could no longer keep up paying the £50 to just bring the account into the black, so we left it and left the charges to build up. By February, the account was £200 overdrawn, and as I had got a bonus from work, I decided to end the saga once and for all. I rang Allinace and Leicester, and told them to close the account and I would pay off the overdrawn balance. I was told that I couldn't close an account with an outstanding overdraft, and I would have to bring the account into the black first. I made a payment to this effect, and contacted the bank again once it had cleared to close the account'. This time I was told I couldn't close the account as there were £50 of charges pending, and these needed to be applied before the account could be closed. I saw red. I made it clear that I was not prepared to pay any more money into the account, and demanded an escalation (I had tried to speak to a manager before but had been fobbed off). Luckily the girl on the phone this time appreciated the account history, and that something needed to be sorted, so the account was placed on hold and the case was escalated. I got a call later that day, and was told that the account was now closed, and there was no balance outstanding. I was finally free.

I worked out that I had in the end been charged £400 of charges for the sake of going £1 beyond the overdraft buffer. I of course tried to levy a claim for unfair charges, but the bank hid behind the mortarium that was in place over claims for charges at the time, so I never got anywhere with it, and they quietly closed off the claim a year later.

Although I'm not making excuses by saying this is a cause of our debts, it was certainly an unwelcome series of events when money was already tight. It has taught me to harbour a deep distrust of banks and also be much more clued up about their practices and how their charges system works.

Another problem we experienced through all of this, was that my partner had defaulted on one of her debts in 2006. Because of the joint account I now couldn't get any credit anywhere so I had to get rid of the association.

tony_ack · 21 September 2011 at 11:22AM

By the way, thanks for the link on the credit card shuffle... All of my cards are pretty much maxed, though Barclaycard are increasing my limit by £1500 next month... I will wait until this is in effect and make the call. I will also see if they'll give me a bigger limit with the understanding that I use it for a BT - there's no harm in asking.

turbo.jet · 21 September 2011 at 12:22PM

Wow, definitely a valid reclaiming case there. What's the status of it now? Are they settling disputes again? I bet claiming that £400 back would not only give you a huge boost to your debt reduction, but also a warm fuzzy feeling over sticking it to a company that screwed you over so royally. Getting my £1600 paid back to me by my bank was a very happy day indeed. It makes my blood boil that we are the customers and still get treated with utter disdain.

I have an interesting story to share about a brilliant customer service experience following a recent bank charge (to keep an existing overdraft in place). But I'm not sure your thread is the place for it.

tony_ack · 21 September 2011 at 1:28PM

The bank in question (Alliance and Leicester) has since been taken over by Santander.

I made a complaint to A&L once the account was closed and as mentioned, they put it on hold, and then rejected it after the outcome of the bank charges test case. I haven't done anything with it since - I assumed it was the end of the road.

Unfortunately, since this all happened 4 years ago, I think it may have happened too long ago to get a successful claim?

turbo.jet · 21 September 2011 at 2:39PM

My claims dated back 6 years so I suspect not. Definitely worth re-opening if possible. I don't even know whether they are still paying. I kinda tuned out after I got mine back.

hazelc56 · 21 September 2011 at 4:09PM

Consumer Credit Counselling Service... cccs.co.uk.

savingholmes · 22 September 2011 at 11:05PM

Hi Tony - you are making cracking progress and you've had some fab advice and support too. You are doing amazingly well already - I admire your willingness to let go of your possessions and sell them - that is great. Over time perhaps you and your wife can try the Make £10 a day challenge on the DFW stage