I make £40k but still can't keep up with payments - SOA

chimaeric

Well some of you may have read my post about payday loans. I think I am just about sorting that one out, but ongoing I need to reverse my negative income.

My total debts are about £45,000. I make £38,500. The debt has been growing for about 7 years, since I took out my first loan to go to Thailand (have to say, it was the best 3 weeks of my life so I don't regret it!).

Before long, HSBC especially were throwing money at me - increasing my overdraft and credit card limits without my goahead. I guess I was weak in not rejecting them, but at one point my CC was up to £8k limit - which of course I spent.

Various loans and credit cards later (each to pay off or try to consolidate), I now apparently have crap credit (unsurprisingly perhaps!) and can't get any loans or CCs at all. And my monthly outgoings are greater than my income.

So babble over, here's my SOA:

Normal 'compulsory' outgoings:
Council tax: £50 (am paying £135 for the next two months because I got behind)
Rent: £750
Utilities: £60
Travel: £112 (London travel card for work)
Car insurance: £30
Car tax: £15
Mobile: £36 (mine and my partner's)
BT phone: £11
Sky TV: £18
Broadband: £18
Cinema subscription: £28 (mine and partner's - seems like a 'luxury', but it means we hardly go out - just go see a film for free).
Dentist plan: £13
TV licence: £34
Total 'normal' outgoings: £1125

Debts
Credit cards
Egg: £35 (outstanding £1750)
HSBC: £135 (outstanding £4200)
Barclaycard: £30 (outstanding £1450)

Loans
HSBC: £200 (oustanding £5800)
IF: £150 (outstanding £5000)
Cahoot: £200 (outstanding £10000)
Egg: £275 (outstanding £15000)]
First Direct: £100 (outstanding £1500)

Total debt payments: £1175

Total outstanding debt: £44,700
(total outstanding debt has gone down from about a year ago - it used to be about £50k I think).


Summary
Outgoings: ~£2,300
Income: ~£2,300

And that's without food, clothing, etc etc.


I do earn some money making and selling websites, but it's not consistent. If I spend a day at the weekend making one, it usually brings £50-60. Which is something I try to do more and more.

My partner did work until xmas, but she's a student and American (just to complicate things!). She wanted to go home for xmas, and had to quit to do so as they wouldn't let her have the time off. She is out looking for another job, but the loss of the ~£3-400 she was bringing in is making the difference. So I support her was well at the moment (mostly covered in the above, but food, a bit of travel, etc).


I will also be receiving a bonus at the end of March of £3k+ (not sure exactly how much), so I need to decide how best to use that.

Hope that wasn't too long, and I appreciate that generally I'm not in as bad a situation as many other people. I'm almost embarrased that I earn so much and have such a huge debt.

Thanks in advance for any help.
Peter

bommer

Normal 'compulsory' outgoings:
Council tax: £50 (am paying £135 for the next two months because I got behind)
Rent: £750 (Can't you find somewhere cheaper to live?)
Utilities: £60
Travel: £112 (London travel card for work)
Car insurance: £30(Do You really need a car as you can't afford petrol & extras - sell & money could go towards your debts)
Car tax: £15
Mobile: £36 (mine and my partner's) (Can't you go PAYG)
BT phone: £11
Sky TV: £18((This is a luxury that should go - what about a freeview box)
Broadband: £18Should be able to find a cheaper deal
Cinema subscription: £28 (mine and partner's - seems like a 'luxury', but it means we hardly go out - just go see a film for free).(This is a luxury and is it really worth the money )
Dentist plan: £13
TV licence: £34(Are you in arrears this should only be £11.37 PM)
Total 'normal' outgoings: £1125

Debts(What are the aprs etc)
Credit cards
Egg: £35 (outstanding £1750)
HSBC: £135 (outstanding £4200)
Barclaycard: £30 (outstanding £1450)

Loans
HSBC: £200 (oustanding £5800)
IF: £150 (outstanding £5000)
Cahoot: £200 (outstanding £10000)
Egg: £275 (outstanding £15000)]
First Direct: £100 (outstanding £1500)

Total debt payments: £1175

Total outstanding debt: £44,700
(total outstanding debt has gone down from about a year ago - it used to be about £50k I think).

NO details of food, home insurance or life cover hair cuts etc.

bobbadog

Could your company not cover the travelcard and you pay it back straight from your salary? My £99 travelcard costs £86 this way x

emzig123

chimaeric wrote:

So babble over, here's my SOA:

Normal 'compulsory' outgoings:
Council tax: £50 (am paying £135 for the next two months because I got behind)
Rent: £750 Can you move somewhere cheaper?
Utilities: £60 can you break these down, do you have arrears or credit?
Travel: £112 (London travel card for work)
Car insurance: £30 Have you shopped around?
Car tax: £15
Mobile: £36 (mine and my partner's) if you aren't in contract, go PAYG
BT phone: £11
Sky TV: £18 Ditch it, you can'tafford it! I bet most of the stuff you watch is on freeview anyway
Broadband: £18
Cinema subscription: £28 (mine and partner's - seems like a 'luxury', but it means we hardly go out - just go see a film for free). get rid, it is a luxury you can't afford until your partner has a job, sorry!
Dentist plan: £13
TV licence: £34 why so high?
Total 'normal' outgoings: £1125

Debts
Credit cards APRs?
Egg: £35 (outstanding £1750)
HSBC: £135 (outstanding £4200)
Barclaycard: £30 (outstanding £1450)

Loans APRs?
HSBC: £200 (oustanding £5800)
IF: £150 (outstanding £5000)
Cahoot: £200 (outstanding £10000)
Egg: £275 (outstanding £15000)]
First Direct: £100 (outstanding £1500)

Total debt payments: £1175

Total outstanding debt: £44,700
(total outstanding debt has gone down from about a year ago - it used to be about £50k I think).


Summary
Outgoings: ~£2,300
Income: ~£2,300

Well done on posting, I hope those pointers give you a few ideas!

fast_track

As you rent your property it may be worth considering going bankrupt.

I can't really see any reason from what you say that you couldn't do this

chimaeric

bommer wrote:

Normal 'compulsory' outgoings:
Council tax: £50 (am paying £135 for the next two months because I got behind)
Rent: £750 (Can't you find somewhere cheaper to live?)We are due to move in a couple of months, but finding somewhere cheaper in London, when I work in the City, is difficult.
Utilities: £60
Travel: £112 (London travel card for work)
Car insurance: £30(Do You really need a car as you can't afford petrol & extras - sell & money could go towards your debts)Something I have thought about, but it's not worth anything (maybe £100). I need my car for work sometimes, and it would make life difficult if I sold it.
Car tax: £15
Mobile: £36 (mine and my partner's) (Can't you go PAYG)I could, but we are on a fantastic deal that means we only ever pay the £19/month each. On PAYG (as previously), the monthly cost would usually be above that
BT phone: £11
Sky TV: £18((This is a luxury that should go - what about a freeview box)Again this partly comes down to ultimately saving, because without decent TV to watch, we would be tempted to go to the pub more often. Lame excuse, but hey.
Broadband: £18Should be able to find a cheaper dealWill be doing so once my contract is up in a couple of months.
Cinema subscription: £28 (mine and partner's - seems like a 'luxury', but it means we hardly go out - just go see a film for free).(This is a luxury and is it really worth the money )I really don't see it as such. We barely ever get to leave the flat, because going to a bar or pub is so expensive. Even for a couple of drinks each, we've spent the cost of one month's subscription. Instead we go to the cinema 2-3 times per week, so definitely get our money's worth. And it is local so no travel expenses.
Dentist plan: £13
TV licence: £34(Are you in arrears this should only be £11.37 PM)
Total 'normal' outgoings: £1125

Debts(What are the aprs etc)
Credit cards
Egg: £35 (outstanding £1750) APR 16.9%
HSBC: £135 (outstanding £4200) APR 15.9%
Barclaycard: £30 (outstanding £1450) APR 14.9%

Loans
HSBC: £200 (oustanding £5800) APR 11.9%
IF: £150 (outstanding £5000) APR 7.9%
Cahoot: £200 (outstanding £10000) APR 14.9% (recently increaed from 8%!)
Egg: £275 (outstanding £15000)]APR 7.9%
First Direct: £100 (outstanding £1500) APR 18.9% I think - repayment of outstanding overdraft, agreement made to pay £100 per month

Total debt payments: £1175

Total outstanding debt: £44,700
(total outstanding debt has gone down from about a year ago - it used to be about £50k I think).

NO details of food, home insurance or life cover hair cuts etc.

Home insurance: Don't have it

Food: £30/week? We've been scrounging around Asda's saver products recently, and shopping at Lidl etc.

Hair cuts: Do my own!


bobbadog: That's actually something I should look into - my company does do a yearly 'loan' for travel.


Utilities breakdown:
Water: £20/month I think
Gas and Electric are card jobbies, but we probably average £20 on each.


As for going bankrupt, I don't see that as an option.

CLAPTON

you really need to work on the budget and include everything that you actually spend; so you need to add food, clothes MOT, RAC/AA, servicing, socialising, holidays ... basically if you are going to spend it over the next 12 months you need to plan for it by including in the budget. Also as the credit is / has run out, you will now need to start saving for those annual costs so you can pay them when they become due.

It's also important to do this, because once the credit runs out, the repayments of debts have to come after spending. If there isn't enough to pay everything you will have to default on the debts. I'm not saying it will come to that but its why you absolutely must get everything down in the budget so you can see the magnitude of the problem.

increasing income must come top of the list of things to do however.

chimaeric

I will try and break down everything I can and add it here (may take some thinking time!).

Increasing income is my priority too - I would look for other jobs, which I am sure would pay a few £k more, but I don't want to do that until my bonus is safely in the bank =0)

I'm also working on ways for the girlfriend to earn, by writing articles which I can turn into websites and sell. This could actually generate a reasonable amount per month.

Thanks for the input so far, it helps me get my head around things!

bandraoi

Your car may not be worth anything, but it's costing you £45 a month, before you've even driven it somewhere. If you really can't manage without a car, I suggest you join a car sharing scheme and save yourself that money.

Your rent probably isn't that bad for London, I presume it's a 1 bed flat between two of you, but it's probably worth adding up the total cost of your accomodation - ie council tax/rent/bills/travel to necessary destinations and comparing that with what you could get in other areas.

Cannon_Fodder

Having BOTH Sky and Cinema subscription is a LUXURY. Very lame excuse.

If you can break down how the debt has change from £50K to its current level, you may find things are not as bad as the total feels. To "find" £5k to reduce the debts once, must mean its possible again. And if you juggle the payments to get rid of the most expensive debt first, then you will start the snowball effect.

If your girlfriend is bored at home in the evenings, how about she goes work in this pub you would otherwise be in, and slip you free drinks?

southern_chick

Hi Peter

can't offer as much advice as most other people on here but....... i have got Sky (£18 a month) and i get free basic broadband connection with that, it was an offer for new customers but if you phone them and say you are thinking of going elsewhere they might just give you to same offer, it will save you £18 a month and every little helps

Good luck SC XX