Advice

RossB87

Hello,

Joined the forum today to try and get some advice.

Currently I have more debt than I would personally like (well, no one likes debt, but anyway). It has gotten to the point that I am surprised that I haven't received a summons or that the bailiffs haven't been round or that my electricity is still on. Here is a rundown of what I owe and where -

Come December, ill owe E.On Energy £245, my current lekkie bill of £98 has been outstanding since early September.

I owe council tax £800 - I have had my two and only two warning letters about not paying. I called them in July to tell them that I was in part time work after finishing Uni and not in a position to pay until I got a full time job. Their response was basically 'tough, you need to pay now'. That was the last time I talked to them and I havent paid since. They want the balance paid NOW, they wont accept monthly payments, according to their letter.

I have a store card (I know...) and a student credit card together totalling about £650 - these are easy enough to keep at bay as it is only the interest I need to pay just now, but they are still hanging over my head.

Further more, I owe my friend £400 (and have done for 2 years...) for writing off her car (doh!) and I would like to pay her back before it becomes a problem, although the deal was when I left uni and got a full time job I would start paying her back. I also owe my mother £400 for my laptop which went on her credit card back in June.

Oh and one other point, I stupidly let my girlfriend book a holiday for us to go in July which needs to be paid off by April. I've already threatened cancelling due to my debts, but even that would cost £400.

To some people this is minimal and probably wish their debt was as low as this, well i wish it wasn't there at all (actually, If i am to wish for something, its that i didnt move out my parents house, then I wouldnt be in this mess).

I have just started a full time job at £14500 a year, which is good enough for now I guess. I've just received my first wage, but as I started a couple of weeks into the month and subjected to emergency tax, I barely have enough money to eat never mind pay my debts. Next month I will get paid a full wage and should get my emergency tax returned to me.

So, I am here for advice on how to tackle these debts. I have applied for 2 bank loans so far, one of which I was rejected for and the other I am awaiting a reply (although I fully expect them to reject me, as I cannot possibly see how I have any semblance of a credit rating. I figured that to pay off these immediate debts I would need £3000, paying back between £60 and £90 p.m. for 5 years, which on my current wage would be perfectly doable. I dont own any property.

Is a bank loan my best option? I spoke to a guy a while ago who was trying to sell me a loan that my best option was actually to get a managed bank account. Any advice on that? I am not very good with money so I probably wont be able to make up my own payment plans for my wages.

Any advice at all would be magic. Im seriously beginning to get worried, more to the point so is my girlfriend, whose flat I live in and is worried about Glasgow City Council bailiffs seizing her furniture!

Statement of Affairs & Personal Balance Sheet

Summary

Monthly Budget SummaryAmount(£)Total monthly income 1,380
Monthly expenses (incl. HP & secured loans) 890
Available for debt repayments 490
UNsecured debt repayments 31
Amount left after debt repayments 459

Personal Balance Sheet SummaryAmount(£)
Total Assets (things you own) 0
Total Secured & HP Debt - 0
Total Unsecured Debt - 730.58
Net Assets - 730.58

Household Information
Number of adults in household 2
Number of children in household
Number of cars owned

Income, Expense, Debt & Asset Details
IncomeAmount(£)
Monthly income after tax 980
Partners monthly income 400
Benefits 0
Other income 0
Total monthly income 1380

ExpensesAmount(£)
Mortgage 0
Secured/HP loan payments 0
Rent 100
Management charge (leasehold property) 50
Council tax133
Electricity 100
Gas0Oil 0
Water Rates 0
Telephone (land line) 13
Mobile phone 32
TV Licence 12
Satellite/Cable TV 35
Internet services 0
Groceries etc. 120
Clothing 5
Petrol/diesel 30
Road tax 0
Car Insurance 10
Car maintenance (including MOT) 5
Car Parking 0
Other travel 35
Childcare/nursery 0
Other child related expenses 0
Medical (prescriptions, dentists, opticians etc.) 0
Pet Insurance/Vet bills 0
Buildings Insurance 0
Contents Insurance 0
Life Assurance 0
Other Insurance 0
Presents (birthday, christmas etc.) 10
Haircuts 0
Entertainment 0
Holiday 200
Emergency Fund 0
Total monthly expenses 890

Secured & HP Debt Description Debt(£) Monthly(£) APR(%)
Mortgage0 (0) 0
Secured & HP Debt totals 0 - -
Unsecured Debt Description Debt (£) Monthly (£) APR (%)
Credit Card 490.58 16 18.7
Store Card240 15 29.9
Unsecured Debt totals 730.5831 - Asset DescriptionValue (£)Cash 0 House Value (Gross) 0 Shares and bonds 0 Car(s) 0 Other assets (e.g. endowments, jewellery etc) 0 Total Assets 0

Thanks.

hallowitch

I live in and is worried about Glasgow City Council bailiffs seizing her furniture!

sheriff officers in Scotland

lvm

RossB, Welcome to the forum!

Your debt is by no means unmanageable so stop worrying about it.

From your SOA, the things I noticed are:

Rent - you definitely only pay £100 a month? Is this each?
Groceries - is this for the 2 of you? Good if it is.
Management charge - is this like a factor's fee? Usually a landlord will pay this...check your lease and make sure about this.

First things first, get on the phone to council tax people and set up a direct debit, starting on your next pay date. This is an essential debt and you can't leave it any longer. Ask for it to be split over the next 12 months although not sure they'll be very keen (try anyway).

Eon is your next priority - you don't want your gas/elec switched off. This should be a monthly direct debit, coming out on pay day or as close to it as possible. Negotiate a reasonable repayment figure.

Any extra left over - you need to throw at your store card then at your credit card (these are really high APR).

In around 6 months you'd probably be able to start paying back your friend and your Mum - these aren't priority when they're not accruing interest.

In my opinion, even if you're offered this bank loan, I wouldn't accept it.

Can you do overtime at work? Get a second evening/weekend job, even just in the short term?

Memory_Girl

You can do this - it will just take a plan and a bit more learning. You can learn how to handle money - after all you are smart enough to get yourself through UNI.

I agree about perhaps looking for a second job for a little while and then accept that like every graduate you are going to be on a "student budget" for just a little while longer as you mop up some issues..................... but money management learned now will pay huge financial dividends in the years to come.

MG

fatbelly

lvm wrote: »

First things first, get on the phone to council tax people and set up a direct debit, starting on your next pay date. This is an essential debt and you can't leave it any longer. Ask for it to be split over the next 12 months although not sure they'll be very keen (try anyway).

Eon is your next priority - you don't want your gas/elec switched off. This should be a monthly direct debit, coming out on pay day or as close to it as possible. Negotiate a reasonable repayment figure.

I agree - these are the priorities. There's no interest on the CT debt but if the bailiffs (sheriff officers) get involved there's all sorts of potential fees, and harassment. It's tempting to get a loan to clear this, but if you act fast you should be able to get some sort of plan with the council to avoid this going any further.

It's unlikely your gas/elec would be cut off but they would be looking at installing prepayment meters and collecting the arrears at a hefty rate on the key.

Former_E.ON_Company_Representative:_Malc

RossB87 wrote: »

Come December, ill owe E.On Energy £245, my current lekkie bill of £98 has been outstanding since early September.

Hi Ross and welcome to the forum.

Thought I'd jump in here with a few suggestions that might help.

Talk to us about the outstanding balance. We'll be happy to set up a payment arrangement to spread the balance over a more manageable period.

Going forward, make sure you're on a deal best suited to your circumstances. There's extra discounts/better prices for paying by Direct Debit and managing your account online.

Check out your usage (we can tell you if you're unsure) and pop this on to one of the comparison sites. This will list all the options open to you, both with us and the other suppliers.

Look at ways to reduce this usage. We can help with this too. Talk to our Energy Efficiency team. Tell them about your property and appliances and they'll be happy to suggest ways to cut back.

Ask for a copy of a booklet called '100 ways to save money by saving energy.' It's free and contains lots of useful tips.

Have a look at our website, particularly the Interactive House and Energy Menu :cool:. More good tips here.

Hope this is of interest Ross and good luck with the savings. Give me a shout if you need any more info as will be happy to help.

Malc

RossB87

E.ON_Company_Representative:_Malc wrote: »

Hi Ross and welcome to the forum.

Thought I'd jump in here with a few suggestions that might help.

Talk to us about the outstanding balance. We'll be happy to set up a payment arrangement to spread the balance over a more manageable period.

Going forward, make sure you're on a deal best suited to your circumstances. There's extra discounts/better prices for paying by Direct Debit and managing your account online.

Check out your usage (we can tell you if you're unsure) and pop this on to one of the comparison sites. This will list all the options open to you, both with us and the other suppliers.

Look at ways to reduce this usage. We can help with this too. Talk to our Energy Efficiency team. Tell them about your property and appliances and they'll be happy to suggest ways to cut back.

Ask for a copy of a booklet called '100 ways to save money by saving energy.' It's free and contains lots of useful tips.

Have a look at our website, particularly the Interactive House and Energy Menu :cool:. More good tips here.

Hope this is of interest Ross and good luck with the savings. Give me a shout if you need any more info as will be happy to help.

Malc

Hey, thanks for that.

I received my bill from E.On and never heard anything back, but this morning I got a letter saying that If I didnt pay then I would be subject to debt collectors. You have helped ease my mind a wee bit, so Im gonna call later and see what is what. I have been trying all week, but the hour I get for my lunch isnt enough to sit on hold!

Ill keep you informed!

Thanks.

Former_E.ON_Company_Representative:_Malc

Hi Ross

Sorry about the long wait on the phone. Our call centres are really busy at the mo.

Setting up a payment arrangement will stop debt follow up, so I'd definitely say it's best you go down this route. As long as you maintain the agreed payments, there'll be no further debt letters.

Give me a shout if I can help. Drop an email to the address in my Profile if you prefer as always happy to help.

Malc

Verbatim

Well done on getting your job! Can't remember the details about managed loans but I do remember that people on here bitterley regretted taking them. Draconian t&cs, losing control over your money plus very large debits each month for their fees.
Setting up dds to leave the day after your wage goes into your bank would be the best and not spending on your cards. Avoid buying if you'll have interest to pay as well as the purchase price. Could you move back home for a while to give you a breathing space to get these debts down?