25 years old and in 4K of debt - help!

Mcad87

Hi everyone, I'm new so apologise if this has been posted in the incorrect place. I'm having a few financial difficulties and thought I should post on here and see if anyone has any useful advice.

Let's start from the beginning:

I'm 25, in full time employment and living in London with my girlfriend. I've got a pretty decent wage and to be honest, I'm just happy to be employed in the current climate. My partner also works but she is on minimum wage at the moment. We earn about 2K a month after tax.

I've got two overdrafts each maxed out standing at £1000 each and two PayDay loans (Yes, I know- I was/am young and was naive to have taken them out) with Wonga and QuickQUid. The Wonga loan is £1400 and the QQ is £800- both equating to over what I make in a month. I also have rent which is £950pcm and bills and transport to also pay.

Anyway, I've now gotten into the cycle of having to pay the Wonga one off every month only to have to take it back out immediately to pay off bills and rent etc and the QuickQuid one I have to keep extending paying about £162 a month for the privilege. I'm not in enough debt to qualify for a DMP or an IVA but in enough debt to have absolutely nothing to my name for 25 days of the month which is crippling, especially in London. To top it all off, I've recently had a lovely and excessive bill from Virgin Active for £234 because I have missed payments that they didn't bother to tell me about.

Really want to break the cycle and if I managed to get rid of the PayDay loans then I would be able to have enough money spare each month to pay off my overdrafts within a couple of months, but getting to that stage seems to be almost impossible.

Thanks for reading, any advice would be greatly appreciated.

Thanks,
Matt

Thrifty_Pixie

i'm sure there are others here with more experience in these matters, but i've heard quite a lot of people call or write to their PDL creditors (possibly writing is best) explaining their situation and offering a payment plan for what you can afford to pay per month. this might give you some breathing space.

good luck!

RAS

Hi

Things to think about.

1. Do an SOA (preferably joint is possible) and let folk help you find ways to cut down.

2. What do you have that you no longer use? E-bay, Amazon or car-boot sale?

Go over to the Money Saving Old Style forum and do either a store cupboard chalenge, where you use what you have to avoid expenses this month, or one of the very low cost menu plans.

Earn a little extra with surveys, reviews etc?

McKneff

Keep a spending diary, dont buy anything that you dont need or want.

No eating out, no £2.50 cups of coffee, its amazing what people spend on incidentals, magazines, sandwiches.

Sell stuff on local auctions, not Ebay, there are many local auctions around.

An SOA would be more useful for us to help you further.

Mcad87

Hi everyone,

Thank you for the quick replies. I actually did a fairly detailed SOA myself on Excel- I will post it when I get in from work later this evening. Was thinking of contacting the PDLs to ask if I can do a payment plan so perhaps that would help. As to going out- we never eat out, or do much of anything to be honest! We never have the money spare to do it.

I've sold pretty much anything I had of value over the last year or so- I had a collection of guitars which have all gone now bar one with extreme sentimental value (my dad bought me it as my first guitar) and I don;t know if I could sell it! Also got lots of odd dvds etc up for sale so hopefully they will help in the long term as I have a few hundred to shift. Local auctions sounds like a good idea will have to do some research on that as eBay charge so much commission.

RAS- you mentioned earning a little extra with surveys etc- what kinds of things could I do those for? Sounds interesting.

Hopefully my soa will give a more precise picture of my predicament and once again all of the advice is really appreciated.

Matt

RAS

have a ferret round here http://forums.moneysavingexpert.com/forumdisplay.php?f=145

choward1234

Hi,

If you go on the payday loan website and get an email address to contact someone on. It is better to do it via email than on the phone as they can not confuse you and also you will have written evidence of what is agreed. It will be a lot quicker to do it this way then via letter.
Send the company a letter stating that you were looking at paying back the whole loan this month but you have gotten into financial difficulty due to .......(car problems, medical, bank withdrew overdraft etc) and that you now only have the money to pay your essential expenses like rent, electric, food and petrol. Due to this you now do not have the money to pay the interest of the loan or the full amount. You have every intention of paying back the whole of the loan but you need to arrange a payment plan for the next 6 months to get yourself back on track. Also tell them that you are withdrawing the "continuous payment authority" that they have on your account so that they can not take anymore money out of your account.
They are normally pretty fair. They may ask you to provide evidence of your overdraft withdrawal or car fees but if they do you just say that you do not legally have to provide this evidence so you will not be doing it. they may ask you to do an income and expenditure as well. again you do not have to do this so just refuse. let me know how you get on x