Massively in Debt and Sad

Newyorkdreams

Hi Everyone - I have been a lurker on this forum for many years but have never posted - until now. My story is not unique and I have read many similar stories that has led me to feel supported and that I am not alone (which I often feel).

I am 33 and my husband is 43. We have racked up approx £50K worth of debt in the last 10 years. Neither of us had a credit cards when we first met in 2002. I went through the whole of my uni life with no credit cards (I did have a student loan and an overdraft which I paid back after I graduated which took 5 years and 2 years respectively). After I graduated I got a £1000 loan to buy a second hand car. My debt was controllable. Just one loan and I stayed with my mum so no real responsibilities. I spent everything I earned on expensive perfume, make up, clothes and going out.

It all started going wrong when I met my then boyfriend and we moved away from Scotland to start a new life in England. Neither of us has ever been a saver, spending everything that we earned. In fact, it was a bit of a joke between the 2 of us and a friend because we were all paid at different points of the month. We all shared a communual £50 to get us to the next payday. Not a great start is it?

So we moved to England and we needed a month's rent up front and a £500 deposit so that set us back £1100. Because of this, we got a credit card to meet our basic living costs. Then we needed to go out to meet new friends so we ended up in the pub every night! (I know...on reflection we could have chosen to do a number of more healthy activities!!) The pub allowed customers to get cashback on their credit cards by putting the transacation through as a meal. In effect, we had 0% on our cards so we were getting the cash with no interest but with absolutely no plan how we were going to pay it back - we just knew we would at some point. We must have spent, minimum, £200 per week on our cards in the pub.

So by this point (approx 2005) we are happily moving our debt around to 0% cards and not really paying anything off, only paying the minimum amount. We didn't have a massively lavish lifestyle although we didn't track, budget or plan for anything. If we wanted it, we bought it, or more likely, we put it on a credit card. I think we also got our first of many 'consolidation loans'.

Then in 2006 we realise that we must try and get on the housing ladder. So, we bought our first house with no deposit. Our stamp duty was paid and we received new white goods and carpets. We also received free legal fees. So we didn't need anything, apart from £200 to secure the property.

Then in 2009, we got married. It was amazing and the best day of my life. However, (yup you guessed it), we didn't save or plan. We basically worked out how much credit and loans we could get on top of contributions from family (e.g. my mum bought my dress, shoes, tiara, veil etc and my dad gave us a contribution. We had an amazing honeymoon in Africa on safari. But we had racked up another £18k worth of debt.

And we are happily going about our lives, then WHAM BAM the market starts collapsing and we are getting refused left, right and centre for cards, loans and any form of credit. Banks and credit card companies continuously say NO. We have checked our credit files from all 3 companies and we are ok. We are always very conscentious with our debt. We ALWAYS pay on time and have never missed a payment. But the banks are saying it's affordability. Even though we know we can afford it (we bring in around £4K a month), no-one wants to take the risk with us any more.

So here we are with all this debt and it upsets me. It upsets me that we allowed ourselves to get in this mess in the first place and it upsets me that the banks keep refusing us. I'm taking it personally even though I know it's not. Don't get me wrong, I know it's our own fault and we made the hole and we need to get out of it but it's just so hard sometimes. I guess I was just looking for some moral support from people who know what it's like and it's a lonely place to be.

Thanks for reading

NYD xxx

[Deleted User]

Standard advice coming up.

Post an SOA.

katy_ann

Well done on recognizing and addressing the problem, there are many helpful and supportive people on this forum with a wealth of knowledge. More experieneced members will probably ask you to post an SOA we can see where/what your outgoings are each month and how we can cut them x

exarmydreamer

Didn't want to read and run. Best thing to do is complete an Statement of Affairs, you will find a sticky at the top of the page. Complete this with as much information as possible including APR's for all your cards and loans.

A spending diary helped me see where our money was going. You will need to track every last penny, all those coffee/tea, papers and magazines. Another big spend is buying lunch/choc bars, only takes a couple of minutes to make sandwiches the night before and works out alot cheaper.

Check out your utilities, Tv etc providers and look on the comparison websites for the cheapest deal. Do you have a spare room, you could take in a lodger, either for 5 (working)days or full time. This would provide you with a tax free income, I think it's just over £5K a year and you don't have to provide food etc.

Try the snowball calculator on here, you should be targeting the highest APR's on debt first and pay the most to this, whilst paying the minimum to the others.

There is always support on this site, no one will judge you here and patience is a must. The debt built up and it is not going to go away quickly but one day it will. I hope this help's, I'm sure more advice will follow.

Triker

You'll get the guidance and support you need right here. Well done for posting, your situation can be dealt with,it'll just take some time, a complete attitude adjustment around money and spending it and a plan.

Newyorkdreams

Bedsit_Bob wrote: »

Standard advice coming up.

Thanks Bedsit Bob, will do that now

Newyorkdreams

katy_ann wrote: »

Well done on recognizing and addressing the problem, there are many helpful and supportive people on this forum with a wealth of knowledge. More experieneced members will probably ask you to post an SOA we can see where/what your outgoings are each month and how we can cut them x

Thanks Katy Ann - I'm slowly finding my way around this site, it's overwhelming me a bit but I'll do a SOA. Thanks x

Newyorkdreams

Thank you so much for your post, it means a lot.

We have already cut back quite considerably. We take our lunch to work 4 days a week (we allow ourselves to buy something on a Friday!). I have just managed to get a 20% reduction on my sky payment just for telephoning up and doing some negotiation. I switch my elec/gas/telephone/broadband when the contract is up to get the best deal, same with house insurance, car insurance etc

My husband and I have both packed in smoking (1 YEAR in 1 MONTHs time!!) but I'm sure there are loads of other things we waste money on that others could help us with!

Thanks again.
NYD x

Newyorkdreams

I'm struggling to find the SOA template - can you help me find it please? Thanks x

Upsidedown_Bear

Newyorkdreams wrote: »

I'm struggling to find the SOA template - can you help me find it please? Thanks x

Here you are

http://www.stoozing.com/msoc/soacalc.php

Newyorkdreams

Here is my SOA:

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2500
Partners monthly income after tax....... 1500
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 4000
Monthly Expense Details
Mortgage................................ 509
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 13
Council tax............................. 120
Electricity............................. 65
Gas..................................... 35
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 25
Mobile phone............................ 30
TV Licence.............................. 12
Satellite/Cable TV...................... 32
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 100
Petrol/diesel........................... 80
Road tax................................ 15
Car Insurance........................... 26
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 2
Pet insurance/vet bills................. 0
Buildings insurance..................... 6
Contents insurance...................... 7
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 80
Haircuts................................ 20
Entertainment........................... 300
Holiday................................. 150
Emergency fund.......................... 50
Total monthly expenses.................. 1922

Assets
Cash.................................... 500
House value (Gross)..................... 100000
Shares and bonds........................ 2000
Car(s).................................. 8000
Other assets............................ 0
Total Assets............................ 110500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 91000....(509)......4.99
Total secured & HP debts...... 91000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Loan - Tesco...................6060......203.......6.8
Barclaycard x1.................4795......110.......24.9
Barclaycard x 2...............11400.....250.......6.8
Mum............................3335......0.........0
Dad............................8500......500.......0
Nationwide x 2.................1209......29........19.9
Nationwide x1..................3847......100.......19.9
Creation.......................3863......100.......18.9
Halifax x 2....................9495......93........9.95
Halifax x 1....................2843......40........15.9
Total unsecured debts..........55347.....1425......-

Monthly Budget Summary
Total monthly income.................... 4,000
Expenses (including HP & secured debts). 1,922
Available for debt repayments........... 2,078
Monthly UNsecured debt repayments....... 1,425
Amount left after debt repayments....... 653
Personal Balance Sheet Summary
Total assets (things you own)........... 110,500
Total HP & Secured debt................. -91,000
Total Unsecured debt.................... -55,347
Net Assets.............................. -35,847
Created using the SOA calculator at
Reproduced on Moneysavingexpert with permission, using IE browser.

Any advice would be gratefully received. Thanks x