Which choice

submarine76

Hi Abby. I used to pay my TV license quarterly, but found it it was cheaper to pay monthly instead. Worth a look to see if it's still the case, evey little bit counts.

abby1234519

sanfrancisco wrote: »

Yes do the 30.34 capital one card. Then focus on paying the remaining balance off of that one and the cash plus one. I know it goes against the grain and all that but sometimes at the beginning of our dfw journey it can feel good to reduce the number of debts, as opposed to paying the highest apr. Once you have paid off these two shut them down and you will have four debts. Woo! When will that be?

You are doing brilliantly. You have definitely had your lbm. Well done! I got out of £70k of debt 10 years ago. I now have house, 3 babies and am financially sound. You never get over your dfw ways tho. I hate spending !!

Keep going xxx

I want to try to get as many debts closed, ie start with the smallest until I reach the ones that are all of a similar size, ie Lloyds and Tesco cards.

Knowing one less payment is going out will make me feel better as then I can divert that payment to another debt or use it in case of emergency.

I'm still sorting my plan out of repaying etc, need to work out whether I should keep my direct debits for the cards going or whether I should just keep a diary of when payments are due out to make sure I pay exactly the amount I want to. Also am using one of the cards for groceries as suggested, and will use the other one for petrol. But have to plan this around payments to card etc and when statement is generated.

Am cracking on with selling stuff upstairs, sold the wedding birdcages for £15. So that cash is going to go in the tin and then I'll empty it all out once that rooms clear.

Unfortunately I need to locate a zedbed to accommodate my family staying over at Christmas. 3 bed house has to hold Me, DH, Joshibobs and then Mum, Sister and 2 brothers!

I've also then got to cook a Christmas dinner for the family using a small over, a halogen oven whilst not shouting at my mother. AND ON A BUDGET! Although I know mum will give me the money for it but still. I need to work out how much food I'll need

debtbgone

abby1234519 wrote: »

I want to try to get as many debts closed, ie start with the smallest until I reach the ones that are all of a similar size, ie Lloyds and Tesco cards.

Knowing one less payment is going out will make me feel better as then I can divert that payment to another debt or use it in case of emergency.

I'm still sorting my plan out of repaying etc, need to work out whether I should keep my direct debits for the cards going or whether I should just keep a diary of when payments are due out to make sure I pay exactly the amount I want to. Also am using one of the cards for groceries as suggested, and will use the other one for petrol. But have to plan this around payments to card etc and when statement is generated.

Am cracking on with selling stuff upstairs, sold the wedding birdcages for £15. So that cash is going to go in the tin and then I'll empty it all out once that rooms clear.

Unfortunately I need to locate a zedbed to accommodate my family staying over at Christmas. 3 bed house has to hold Me, DH, Joshibobs and then Mum, Sister and 2 brothers!

I've also then got to cook a Christmas dinner for the family using a small over, a halogen oven whilst not shouting at my mother. AND ON A BUDGET! Although I know mum will give me the money for it but still. I need to work out how much food I'll need

Just popping by to see how you're getting on x

tgroom57

Agreed. Close Vanquis!
Stop buying things from Very and Simply Be
If you stop for long enough Very will send you a £20 off £40 spend to get you going again, but you have to not spend for about 6 months.

Start living frugally now - whatever that means for you. You will find there are things you can live without and small savings can be made. It is a mindset - you will get better at living frugally by practice.

Please watch your credit accounts very closely, because some companies will hike your interest rate when you get close to your limit. Others (Halifax on me) might cancel the overdraft facility at the yearly review.

loltara

Why are we so paranoid about debt. It's only a problem if you need a mortgage. i.e. a good credit rating. Better to go bankrupt and free your mind from the worry. Let's face it, mortgages keep us trapped in fear and with wages versus property prices, fewer and fewer can afford them in any case. It's only some huge corporation's paper trail. Let them worry about it, not you. Get yourself back to a debt free situation. If you can do noodles, veg n pasta sauce for a few weeks you can possibly get rid of debt yourself otherwise go the bankruptcy route. The stigma is only in our mind.

VJP

Hi there Abby - first of all well done for tackling this head on.
I came to this point and decided to not go bankrupt. It's unfortunate people like James think this is a 'choice' and make unhelpful comments. I my case it was not a choice. Anyway things have improved slowly - I have a better paid job now and have managed to get all my debts onto interest free cards - there are some good ones for higher risk borrowers. I phoned up my phone company and got a 25% discount just because I hadn't hassled them in a year apparently! I got a season ticket loan for travel which knocked off a good amount. I do the shop once a week so that I don't buy as and when. Every few pounds helps. You can also ask for a water metre which will cut bills. In our case they could not install one so put us on a lower tariff instead. I could not believe I would be this good at living frugally and enjoy life but it is working and in 12-14 monnths will pay off 10K. I see what you mean about your spare room, but I would really urge you to see if there is a way you could put the computer anywhere else and babies clothes anywhere else eg wall fixtures? I'm sure someone will rent it if the price is right! and that will make a dent. For me the spare room let is key - and they also pay a share of bills. But I do think it is key that you get your debt onto interest free cards ASAP which may mean paying off a card, closing that one plus the Vanquis and that way your credit will look better. I'm sure you are already making lunches and dinners from scratch so I won't go on about that!

Turningitround

I was in a very similar situation around 6 months ago. I'd spent years building up debts with my head buried in the sand. I have a good job, but my income just covered my minimum payments.

I had no control on my money and when a card was declined in a shop, I just used another. I never looked at balances, it was all too stressful for me.

A real low point got to me. I started looking at debt management plans, maybe bankruptcy, getting arrangements to pay on debts etc.

However, these options are *REALLY BAD*. They won't stay with you for 6 years. In most cases they'll stay with you for 6 years after you've finished paying everything off.

You're not in a hopeless situation. Debt carries momentum. It takes real determination to slow it down, stop it, and then gather momentum in the other direction to get rid of it all. I'm very far from debt free (it would probably make your eyes water), but I'm managing it properly now and chipping it away more and more quickly. It's actually now a pleasure to look at my finances and I can see the light at the end of the tunnel getting bigger.

Here's what I did:

First I made a spreadsheet that had all my monthly income and outgoings in. There's a credit sheet with all the APRs, when any deal end and the minimum payments, true costs of overdrafts. I have a cash flow sheet that I update daily - this is key so I can see more clearly into the future if any unexpected bills occur.

I then took a long hard look at my outgoings. I cut everything back to the bone. I cancelled everything that was not absolutely necessary. I then used the MSE site to save money across the board. this included: Swapping insurances, changing energy providers, getting a water meter fitted, switching bank accounts for the bonus, selling books online etc etc. I also sold as much as I could, even if it was for just a few quid. I also now shop at Aldi and take a list EVERY time. If you can cut money off your grocery bill this will get the debts down faster.

It mounts up quickly, so even if you save a few tens of pounds a month, it makes a big difference when you pay off your debts.

The real biggy though is getting good deals on credit cards. The MSE eligibility checker is really good. Keep chipping away your highest interest debts first and keep checking for 0% credit deals. As soon as you can, move your debt to a nicer place.

A key part of this though is to snowball your payments. Every spare penny should always go to paying down the debt. You should always be overpaying on your worst debt.

You could also consider getting a second job. Even a few extra hours a week would translate into a lot of paid debt over the course of even just a year.

Penny pinching and paying off the debts as quickly as possible is habit forming, stress free and even enjoyable

acidcat

Just a few bits to add:

1) Again would agree with everyone else - pay off debts by %interest, not quantity on the card. So definitely bin the Vanquis card ASAP as you were planning and transfer the Capital one debt that you're not paying 0% on.

2) Keep selling stuff as able to - it really makes a difference. I would go as far as saying that you should sell the outgrown kids stuff - you wanted to hang onto them for a second kid, but are you likely to be in a position to have a second kid any time soon? Might be better to sell them now, use the cash now you need them and then when you do have a second kid, consider 2nd hand clothes then.

3) As you partner is finishing college in June and might be in a position to take in another job then (or alternatively maybe do more childcare and cut costs there) things will get better if you can just hang in there. For this reason I would say your partner would ideally need to delay university for a little bit while you're both struggling so much.

4)This is not going to help till a decent chunk of time into the future, but try and cut costs further when your TV and mobile run out. £35 per month each for mobile is expensive - would pay as you go be cheaper for you? As you will have a phone (or alternatively consider buying a very cheap one from somewhere like CEX) consider sim only which is much cheaper - 3 mobile does a sim only deal with 600 minutes, unlimited texts, 1Gb data per month for £10/month on a 12 month contract (If you can go with fewer minutes and data they have even cheaper deals). I understand what you say about watching TV instead of going out, but as you point out youview boxes and stuff don't have ongoing costs (and again are only temporary until you have cleared your debts). You might be able to find free events around your area for entertainment to fill in the gaps or enjoy the time with your partner and kid.

5) On your list, you have £20 going on Emergencies - if this is whatever emergency crops up that month then there is nothing you can do about it. If it's going into a savings account or anything, it is worth using that to pay off your debt.

6) Very best of luck with all of it. It isn't easy but it will be all worth it.

acidcat

VJP wrote: »

I see what you mean about your spare room, but I would really urge you to see if there is a way you could put the computer anywhere else and babies clothes anywhere else eg wall fixtures? I'm sure someone will rent it if the price is right! and that will make a dent. For me the spare room let is key - and they also pay a share of bills.

I would completely agree with this - if you are offering a cheap enough rent, someone will stay in anything (see the crazy small places in London!). Extra income would make a big difference.

Only problem for me is generally sub-letting is a big no-no in most rental contracts, so not sure if you can actually do this legally.

sianhumph

loltara wrote: »

Why are we so paranoid about debt. It's only a problem if you need a mortgage. i.e. a good credit rating. Better to go bankrupt and free your mind from the worry. Let's face it, mortgages keep us trapped in fear and with wages versus property prices, fewer and fewer can afford them in any case. It's only some huge corporation's paper trail. Let them worry about it, not you. Get yourself back to a debt free situation. If you can do noodles, veg n pasta sauce for a few weeks you can possibly get rid of debt yourself otherwise go the bankruptcy route. The stigma is only in our mind.

Loltara, so where do you think this debt goes ? Who do you think pays for it ? Do you think it is the fat cats who head up the credit cards ? They will not worry about it . Have a think. It is why the credit card interest rates are so high which makes life more difficult for people who are trying to make ends meet ie higher rates to cover the defaulters