Decided to try to get debt free - from a shopaholic

spadge_2356

Hi Dwain,

Sorry to hear about your debt issues! I've worked as a debt collector in one of the high street bank's call centre, so I've given alot of advice on this matter.

Have you considered Payplan as your DMP providers? Firstly they are free to use (funded by the banks I believe) and should be able to tell you if you're eligible for bankruptcy, IVA, sequestration, DRO and whether that is the best option to take. If that isn't a solution they will make arrangements with your creditors to reduce interest rates and make payments affordable/re-payable. The main reason I suggest Payplan is because you pay them the money and then they distribute the cash between your creditors for you, but you can also use the Consumer Credit Counselling Service, Citizens advice ect, but I'd advise staying away from debt management companies that charge a fee they often cause problems for your creditors and yourself in the long run.

Secondly, any DMC will go through some sort of budget so you know how much you'll have to spend on groceries etc, then whatever is left over gets split between your creditors based on how much you owe to each one.
It helps to change your current account to one that has no overdraft facility and just has basic benefits (such as a visa card and free cash withdrawals) as this will force you to live within your means. Try and use a bank that you don't hold debt with as banks such as HB0S have been known to simply take money out of their customers bank accounts to offset arrears on their credit accounts.

AVOID payday loans at all times! How the government allow these companies to operate I will never fully understand!

If your still impulse buying try and use martins money mantra's "do I need it, can I afford it?" etc. I think martin has a budget calculator spreadsheet somewhere, use that to track your budgets (it helped me). As soon as your on an arrangement you will find that nobody will want to lend you money, you just need to focus on living within your means.

I'm not a doctor (please don't think I'm being horrible) but perhaps you might want to speak to one just to make sure you're not depressed etc because that can be the cause of things like this.

I wish you all the best and I hope some of my advice has been useful.

SPADGE_2356

DwainDibley

Wow, thanks for all the great advice everyone!

I have suffered with depression for a while and am on medication for it, and yes my spending is quite compulsive - that's a good way of describing it. It is tempting to go for some sort of debt management plan through CCCS though I'm worried about it's effect on my credit rating. However I suspect my rating currently isn't a great deal better than Greece's at the moment anyway!

Then again having the options for credit taken away from me will stop me adding to it - but will it affect things like my mobile phone contract, Paypal account with Ebay, and what interest rate we could get when we next renew our mortgage deal?

I want to get to the bottom of why I spend like this, it might help with my mental health as well a my financial health and as has been said make it more likely that I will stay 'on the wagon'. My wife has had problems in the past and has a 'Think Banking' account, she wants me to get one of those too - would it help or not?