My Situation

motinter

Here's my situation atm - I'm 25 at the moment and am shocked at where my situation has got me - my debt has seemingly been spent on nothing physical.

Credit Card 1 - £9000
Credit Card 2 - £4000
Student Overdraft - £1000

I am a sole trader and atm my monthly income masses to anywhere between £1200-1800 a month before tax.

I pay rent at home for £300 a month
I pay rent for work at £300 a month
Minimum payments on credit cards are £300 a month combined
Other bits and bobs (phone, insurances etc) = £50

Food & travel to work = £160 a month

So on a bad month I am literally left with no cash to spend.
And on a good month I don't have much left.

Any advice welcomed on this situation - as basically I seem to be getting no where and I really see no future for myself. I have no spare cash to spend on improving my business, which is what I need to be doing to be bumping up my income.

Edit: I don't own a home, a car or anything like that. My most expensive possession is my laptop or tablet which I need for work. I literally have no possessions to my name. My parents rent the home that I live in (so not sure if that would affect them in anyway).

tigerfeet2006

Please give BDL a ring and they will go through all your options with you. If they suggest BR then pop back here and we will help and support you as much as we can.
Business Debtline - Website: http://www.bdl.org.uk/ Telephone: 0800 197 6026

motinter

Thanks Tiger - not sure whether it makes any difference, but all of the debts are personal debts.

No business debts whatsoever.

longtermplanner

If it wasn't for the credit card payments, you would seem to have a surplus every month. If you go bankrupt, you would have to pay this to the Official Receiver, so you are unlikely to be left with surplus money to invest in your business.

I think it would be a good idea to talk to Business Debtline to see if your business is really profitable. If it isn't, then there may be no sensible option but to look for alternative work

If the business is profitable, you might consider a Debt Management Plan if a complete Income /expenditure (which BDL can help you with) shows that you can't pay the full card repayments each month.

Mr_F_Dorsetty

mattyashy wrote: »

I am a sole trader and atm my monthly income masses to anywhere between £1200-1800 a month before tax.

Your money issues I will not comment on, you should see a professional.

But in general I will say this:

If anyone wants to earn £100k a year, then only deal with people who earn £100k a year

That is both a truism and a hard fact. If anyone spends their time selling goods or provides a service to people who earn £15k or £20k a year because that is the interest level of the goods or service they are selling; guess what they earn.

If it were me, I'd find a better product to sell that cost considerably more and appealed to far wealthier people, the same goes if I was providing a service.

You however must of course do as you see fit, obviously.

debt_doctor

Thing is, is your business viable? It doesn't seem to make a great deal and some of the costs you mention are business costs anyway like rent for work at £300pm and other costs - which means your business seems to generate profit equal to less than you would take home in a full time minimum wage job.


I guess the credit card bills are simply due to using them to supplement you meagre income.


So first you must decide, do you want to - and actually CAN you carry on the business?


DD

pmlindyloo

debt_doctor wrote: »

Thing is, is your business viable? It doesn't seem to make a great deal and some of the costs you mention are business costs anyway like rent for work at £300pm and other costs - which means your business seems to generate profit equal to less than you would take home in a full time minimum wage job.


I guess the credit card bills are simply due to using them to supplement you meagre income.


So first you must decide, do you want to - and actually CAN you carry on the business?


DD

I would agree with this.

What is your actual profit from your self employment? Have you got these figures? Have you done a tax return for the last year? Have you got an accountant who helps you with what can be deducted?

You MAY be eligible for working tax credits if you are working 30 hours a week and your actual profit is less than £12000 a year. However, you will need to give evidence of your profits.

See here:

http://www.hmrc.gov.uk/taxcredits/start/claiming/income-hours/self-employed-income.htm

If your actual profit is less than the minimum wage calculated over the 30 hours then you seriously need to consider getting a job as an employee.

Even if you are entitled to working tax credits based on your profit then self employment as regards this is coming under increased scrutiny to make sure that everyone is earning at least the minimum national wage.

As regards your debts you either have to up your income to service them (a second job?) or get some debt advice from a free advice service.