In debt all my life time to face up to responsibilities

dprovan

Hi

I am 39 year old man and have been in debt all my life. As a child we had nothing. I remember my borther, my mum and I all hiding behind the couch/sofa as the coal man chapped the window looking to be paid. I also remember going to get the shopping from the local shop when I was about 10 and asking for it to be added to the book on credit.

When I started working at the age of 17 I lived from pay day to pay day. Mostly spending all my wages in the first week and scrimping and scraping for the next three. I think I used to get a buzz from 'robbing Peter to pay Paul' this was one of my mums favourite sayings.

Mrs provan was good with money when I met her, she had savings and always had money at the end of the month. However once we got married the pattern of my youth continued. Over the years we have always lived in debt. We have lived a very materialistic lifesyle upgrading our house, going on holidays every year and treating ourselves and the children to whatever we have wanted. I am now exhausted with the worry of what happens if either of us loose our job and constantly juggling the finances and trying to balance the books.

The frightening thing is that we have been kidding ourselves for the last 10-12 months thinking we have cut back or are going without. This has only meant that we have begun to resent the sacrafice we are making and end up loosing heart. The truth is we still spend money very frivuosly.

We need to change, I no longer have the energy to keep doing this. I dont want my kids to follow in my footsteps (they currently have no idea about our money concerns). I want to know that there is money there for an emergency.

I am ashamed and would be terribly humiliated if any of our wider family or friends knew the full extent. Mrs provans family are all very careful and responsible with money ant they wouldnt sleep if they knew the situation we were in.

I am going to keep a diary to motivate me, because I know I am going to be here for a while. I also know that others have been on this journey or are on it now and I will be glad of any advice along the way.

My debt as of today is as follows:
cc: Halifax 9679 6.95% life of balance(normally pay £200 per month)
cc: Virgin 5507 6.73% life of balance (normally pay £100 per month)
cc: Halifax one 5142 0% until Aug 2012 (have 0% with barlaycard for 22 months to replace this deal) (paying £70 per month)
cc Tesco 5946 0% (not sure until when but well into 2013 will need to check date) (paying £80 per month)
cc MBNA 4381 0% Oct 12 (paying £55 per month)
cc: M&S 1861.97 0% Until June 2013 (paying £40 per month)
Loan Halifax 10325 paying 295 per month ( not sure of interest rate, think it was around 7% ends June 2015)
Overdraft 3k. (pay £30 per month in charges for this)

So total debt is a terrifying £45,844

My income is :2592
Mrs Provan :1724
Benefits :188

Total income £4504

Total expenditure including debt repayments: £4200

The above expenditure includes debt repayments of £870 per month.

So I should have £300 spare every month to add to debt or savings, this seldom happens mainly because it is spent on rubbish.

That was painful to share, but today is the start of a new phase.

dprovan

Our debt at its highest 6 weeks ago was £46854. So whilst there is a long way to go we are on our way.

I have set the following Priorities:

Priority 1: Pull together an emergency fund.

Priority 2: Cancel Sky to save £65 per month

Priorirty 3: Complete a spending diary

Priority 4: Make home made lunches. Cut down on spend per month on alcohol. Probably close to £120 per month on this alone... Not good I know. But when you are running from relaity it is a comfort blanket.

Priority 5: Try to focus on day to day rather than getting overwhlemed by the big picture and enormity of it all.

longforthesun

Hi

OH and I had £40k debt and had out LBM in 2008 so I sort of know where you are at.

Sounds like you have a good plan. We cancelled cable as we were £95 a month. Went to freeview and the kids now don't miss the extra channels.

I agree with focusing day to day after a while you will be able to look further but little steps to start with.

Good luck.

dprovan

thanks longofrthesun. One of the things I find most comforting about this site is seeing that others have been in the same position and got to the other side.

My youngest woke at 4.50am to use the toilet and that was me wide awake. last thing I thought of going to sleep and the first waking up is our money situation. The enormity of it all is daunting. I have a tendency to get involved in a bit of catastrophic thinking and find myself thinking what if this happens, what if that happens. Before I knew it I was lying in bed imagininging all sorts of terrible scenarios linked to our financial situation. Not conjusive to sleep. Also the reality is that the situation is bad enough without what ifs.

I need to look at alcohol intake, I know I have gotten into the habit of having a couple of beers each night which not only has a cost but leaves me feeling groggy the next morning. I am worried that I wont sleep without it and will then lie all night thinking about this mess. So Priority 5 is to look at alcohol intake and cut out at least during the week.

We have been lucky so far. We have never not been able to service our debt. We both have good salaries and have retained jobs in troubled economic times. But now is the time to really change our mindset and spending as this debt wont take care of itself.

My DW works P/T 3 days per week. She moved from F/T to P/T with the birth of our youngest. This after we had moved to a much bigger house (a decision based on 2 F/T salaries). We have the option of her returning to 4 days per week until next April (possibly the option to increase longer). This would mean an increase in income of £540 per month. My DW is reluctant and I feel guilty for encouraging in this direction but the reality is we need the extra money. We need to balance this as we rely on grandparents to help with childcare. But between us we can have flexibility with work that it should be a minimal increase in time commitment to grandparents. I wish we were in a position to say leave it for another year but we are not. So this along with DW pay rise for October will mean a monthly increase of £610 from October for 7 months at least.

We are heading away as a family for a few days as of this morning. Hotel booked with tesco vouchers and spending money covered by lovely relatives who always give us some spending money to take on any trips. So I need to try and get my head cleared and enjoy it. DW and I have discussed this so much lately that a break from it all will be nice.

never_too_old

morning
you will get loads of support on this site,it helps me no end.I can totally understand the endless worry,glad Mrs P is on board otherwise its a lonely journey.Have a lovely few days away and when you are back try and post every day,i will subscribe to offer moral support.:D

moo2moo

Whilst you're in this frame of mind use the snowball calculator to give yourself an extra kick up the bum. Even the smallest change knocks weeks or even months off your debt free date. Its one of those things that it's easier to look at long term than short. Whilst not having a beer next Tuesday makes £1 difference to your budget next week over the 5 years that you're realistically looking at to clear your debt its worth considerably more since thats £1 that you're not paying interest on for that time.

Admitting you're in debt is the easy bit. Actually doing something about it is way harder and sticking to it for years is even harder than that but it is achievable and you very quickly get used to it. Its a long hard slog but it really is worth it. Good luck. You can do it if you really want to.

RunbeforeIcanwalk

I just wanted to say welcome and good luck. We are in a very similar situation to you. Our debt would be much much higher if it was not for a family member for which I am very grateful.

We too have 3 kids (am guessing 3 from the Child benefit amount!) and its so easy not to say no and get them whatever they want.

I agree look at the snowball calculator to work out the best amounts to be paying on each card to clear the debt the quickest.

We too have the alcohol issue here, Hubby likes his beer and I enjoy my wine and this takes up a lot of money. Definately something to cut down on.

You can do it.!

dprovan

Hi folks, and thanks for the replies and the encouragement.

RunbeforeIcanwalk: yes 3 kids. Our situations sound very similar. I recognise that I have spoilt the kids and not set a good example. Actually we have all been spoilt in previous years as we have just bought what we wanted thinking that if we had access to credit this meant we could afford it! Without recognising it every walk, every trip to the park involved some spend, an ice cream, a packet of sweets. So we have conciously begun to address this and have some activities/trips with no spends. The alcohol is something I am going to have to watch closely and monitor.

Moo2moo: you are so right admitting the problem is the easy bit keeping focussed for the time we need to is going to be the tough part. That is where I have fallen down before. I have admitted before that we have a problem and stuck at it for a few weeks/months before feeling that we have made such a sacrafice that we deserve a treat! This is why we need to change our psychological outlook about money and what we value in life. We are working on this and it will take time.

never too old: thank you we had a lovely break in county claire. The weather was predictably terrible but we made the most if it. We stuck to budget and had a nice time together.

It is a week since I last posted. We get paid on Thursday and we have a surplus for the first time in months. This is the first month where I am not running around moving money from here to there or even borrowing money from the kids saving to cover a shortfall . I was awake at 2am this morning and knew I would get straight over to sleep again as I wasn't worried about money.. Now that it something worth having...

Practically we:
have cancelled the sky which will mean a savings of £65 a month.

We are keeping a spending diary and completing it every day. This is really helping and keeping us focussed.

We previously budgeted £80 per month for my wife to spend. This usually was spent on harircuts/things for the house (new curtains, quit etc) but we already allow £100 per week for additional spending outside of food, petrol and bills so those items will come from this and we will have to wait for such a luxury. This means that we should now have £423 per month spare to build an emergency fund.

This pay day I am expecting a £250 work bonus. I am really excited for the first time in my life to have some spare cash/emergency fund/savings together.

I will look at the snowball calculator at the start of the month to work out how best to divert money.

thanks again to everyone for your encouragment.

moo2moo

Forget about the emergency fund. Its a nicety that you're not in a position to have just yet. Its something to aim for in the future. If you've already allowed £100 a week for things you haven't thought of you've got ample to cover most unforseen things. Throw the £423 at the debt with the highest APR and the same with the bonus. You've already spent it many times over. Harsh I know but its the mindframe you need to get into to get rid of the debt.

Comes the big question...... of the £100 you allow for unexpected things each week how much did you have left from last week? Did you really need to spend what you spent and crucially what have you done with the surplus? Its a small amount of money considering your income but that £100 a week is £5200 a year or pretty much the Virgin card cleared.

I know that sounds really negative, its not meant to be but its easy to just spend another fiver or to splurge on something frivolous using whatevers left over from the previous week and hey presto you're right back where you started.

dprovan

hi moo2moo, dont worry it does not sound negative at all.

We were on holiday last week so not really working to the usual budget. We used the £100 from this Thursday past to next Thursday. The money has been spent so far on:
£10 to buy oldest son ticket to milk cup football matches(this will be his entertainment all week).
£7 on 2 pairs of trousers for same son for school.
£5 for my 5 aside football (once a week).
£4 sweets for the kids.
£5 gift for relative.
and similar spends. We reckon we will have £50 saved from this by Thursday and it will go into the emergency fund.

I understand what you are saying about tackling the debt first but I dont agree. About 6 months ago the clutch went on my car at a cost of £450 I had to run around and get a new credit card which covered this kind of spend. We want a savings pot which can act as an emergency and as it builds and we dont need it we can start to divert this to the credit. The savings i would make from dverting this to debt is not enough to justify the sleepless nights i will continue to have knowing there is no money for any significant expenditure.

2joanne

Hi ya! You're situation sounds ever so similar to mine also...good incomes..terrible with money!!! I agree with moo 2 moo..pay off the debt first before building a big emergency pot...I've saved £500 back for real emergencies as this will cover most blips like your clutch ...then every last bit of my spare income goes to servicing the debt..

The best piece of advice I can give u at just over one month into my journey..is cut up the credit cards and keep going with the spending diary..it's helped us cut back n the alcohol big time...now we just have a drink on fri/ sat after being horrified at how much we were spending!!!

One final thing I've learned is don't cut back too much..allow yourself some luxuries however small..by completely cutting back previously I've fallen off the so called wagon and blown all my hard work..better to run the marathon and reach the finish line than sprint and fall at the first hurdle!!

I've a diary on here if you want to follow...I'll follow u too and we can keep each other motivated on the down days ...ive had a few so far but the support in here is fab...I've my mojo back and am firing on all cylinders since my first wobble...

Wishing u the very best of luck!!!