Need help with debt

scott_parker

Hi

I have got myself into a fair amount of debt, mainly due to a gambling problem that led to me taking out many credit cards and loans. I know that it is my own fault, and I feel ashamed that I have got myself into this mess. I have now managed to stop my gambling, but I am in need of some advice regarding the debt that it has left behind.

My current debts are:-

Natwest Loan = £7,500 - Paying £200 per month for 4 years (took out this loan to pay off 3 credit cards).

MBNA C/Card = £2,900 - Paying £50 per month (£1,700 - 0% until June 2016, £1200 - 22.95% interest)

B.O.S C/Card = £1,500 - Paying £25 per month (£1,200 - 0% until Feb 2016, £300 - 21.95% interest)

Natwest Overdraft = £ 1,000 - Paying nothing (19.95%, around £15 p.m interest)


I am working, but only come out with just over £850 per month. I am still living with my parents, and I pay them £200 per month. I cannot really afford to pay much more of my debt each month, as I use the rest for other expenses such as petrol, insurance, phone and living expenses etc.

I am more worried about the credit cards and my overdraft. Once the 0% periods finish, I will only be paying the interest each month, and I will not be able to get another balance transfer card due to my credit rating being so bad (took out many payday loans, credit cards and loans in the past year).

Any advice on my current situation would be greatly appreciated.

Thanks.

rockm87

Hi and welcome

the best place to start is to put together a SOA. this will outline ALL your incomes and outgoings to better see what you have going on. Don't guess, try and be as precise as possible for people here to be able to offer advice.

http://stoozing.com/calculator/soa.php

Best of luck!!

Craig32

Scott,

I am going through a similar experience as you right now, with my gambling debts at just over double what you have, but you are in a great place for advice. I have been amazed by the positivity and great advice passed on in my moment of need, in ways to tackle the debt.

On the gambling front, I haven't gambled in just over a month now. The first week was horrible as it is all that was going through my mind, but as each day passes, it becomes more and more of a distant memory.

Ensure you have excluded yourself for good from any gambling websites you were signed up to. Exclude yourself from betting shops & casinos.

What took me so long to understand was to accept my losses. I have lost track the times I took out further credit to use to gamble to try and win my money back (which obviously failed miserably), continuing to get myself in a bigger hole.

Another thing that took a weight off my shoulders was discussing it with my family, friends & partner. My family still haven't bought into my stupidity and can't get their head around it yet. But my friends have been exceptional, understanding the issue and keeping an eye on me to ensure I don't gamble, nor allowing gambling to be brought up in our circles when socialising.

The worst thing I done was bottling it all up and not sharing with others the problems I was going through. It felt incredible to finally get it all off my chest.

Good luck mate, stay strong and you will get through this

scott_parker

Thanks. I will put together a SOA as soon as I can.

With regards to talking to my family about it, I have been in this situation before around a year ago. I was in around £10,000 worth of debt, and I told my family everything. They were very dissapointed, and couldnt understand it, as no one else in my family gambles at all, but they were supportive. I stopped gambling for months, but made the mistake of leaving my online accounts open.
Then after the unexpected death of a family member, I got very down and started gambling again.

I then 'got lucky', and won £10,000 playing online slots. I told my family about this, and told them that I was going to pay all of my debts off, so I was going to be fine. But I didn't, I spent every last penny of it in the space of about 2 weeks, and then spent more on my credit cards.

My family still think that I am now debt free, so I cant possibly tell them that gambled it all away, as I dont think they will be as supportive this time.

scott_parker

Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 850
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 850
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 200
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 20
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 50
Clothing................................ 15
Petrol/diesel........................... 120
Road tax................................ 15
Car Insurance........................... 45
Car maintenance (including MOT)......... 15
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 15
Haircuts................................ 10
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 565

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 3500
Other assets............................ 0
Total Assets............................ 3500

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Natwest Loan...................7450......200.......13.9
MBNA Credit card...............2900......50........22.95
B.O.S Credit card..............1500......25........21.95
Natwest Overdraft..............1000......0.........19.9
Total unsecured debts..........12850.....275.......-

Monthly Budget Summary
Total monthly income.................... 850
Expenses (including HP & secured debts). 565
Available for debt repayments........... 285
Monthly UNsecured debt repayments....... 275
Amount left after debt repayments....... 10
Personal Balance Sheet Summary
Total assets (things you own)........... 3,500
Total HP & Secured debt................. -0
Total Unsecured debt.................... -12,850
Net Assets.............................. -9,350

rockm87

Can I ask what your job is? You spend quite a lot on fuel/petrol I take it this is to get to and from work, you need more income. Are you able to change, somewhere closer to home for instance?!

You do need support with your addiction, I'm sure there are groups or a support line you can call. Really dont deal with this on your own, and you've proven that telling your family does help you, even if in the short term. Dont let it eat you alive!!

scott_parker

I am currently training to be an accountant, so I am on a low wage at the moment, as my employers are paying for all of my training and exams. I do obviously expect my income to increase, but it wont be by a great deal until I have finished my exams (around 3-4 years).


I use my car for getting to and from work and college, and cant really change my job at the moment.


I really just want to get my debts paid off and put this behind me. I really wanted to be in a position to start saving for a deposit for a house by the time I have qualified.

andyfromotley

Hi Scott,

a couple of things, you realise that you are a compulsive gambler? Well done on stopping for now. If you want to really give yourself the best chance of making it stick get yourself along to gamblers anonymous. You will always find a warm welcome and a friendly ear, theres also a real plan to help you keep gambling free. You can find details of a local meeting on their website http://www.gamblersanonymous.org.uk

secondly you need to increase your income. your payments are going to increase substantially in under a year. You need to pay as much as you can off in that time, and then continue earning to pay the increased minimum payments. Find a better paying job, ask for a raise, get promoted, overtime, acquire more skills, second job, third job, work work work. Income is king for you and your situation right now.

You can do both of these things but you are going to need determination and staying power. Wishing you luck my friend.

[Deleted User]

The only things that strike me, are:-

Mobile phone - Is this really essential? If yes, can you reduce the running costs? PAYG/sim only can be had for ~ £10.

Petrol/Diesel - £120 is a lot. Is any of it non-essential travel? If so, limit travel to absolute essentials.

Road tax and insurance - Both are on the high side (£180 & £540 respectively). Can you trade the car for one cheaper to run? This may also cut fuel costs.

Any chance you could do without a car completely?

Entertainment - I don't think you can really afford this right now.

The MBNA Credit card is a killer. You aren't even covering the interest, meaning trhe balance is going UP each month.

Putting the £50 from your entertainment toward it, will clear it in 42 months.

I know 42 months without an entertainment budget is hard, but, given you are currently slipping deeper into debt each month, needs must.

scott_parker

Thanks for all of your advice.

With regards to the car, pretty much all of the mileage I do is essential. I couldnt do without a car as it would be difficult to get to work and college, and the insurance is on the high side due to my age (22). My fuel bill is sometimes slightly lower, but I didnt want to understate the cost.

With the mobile phone, I am tied into a 12 month sim only contract until November, when I will be looking for a cheaper deal.

I also forgot to include £10 per month bank account fee (which gives me breakdown cover, mobile phone ins etc), and around £10-£15 interest charges from my overdraft.

With regards to my credit cards, part of the balances are still at 0% interest as follows:-

MBNA = £2,900 (£1,700 @ 0% until July 2016, £1,200 @ 22.95%)

B.O.S = £1,500 (£1,200 @ 0% until February 2016, £300 @ 21.95%)

My overdraft is £1,000 which I am using every month, so I am getting charged interest every month at 19.9%, so usually £10-£15 per month.

If I do have any spare money left over at the end of a month, what would I be better paying? Would it be better to make a payment to the B.O.S credit card, as the 0% finishes sooner?

Also as I said before, my credit rating is very bad, due to taking out many credit cards, loans, payday loans etc, but I have never missed any payments. How long will it take for my credit rating to improve to a level where I may be able to get a 0% balance transfer card?

Thanks all.

rockm87

I wouldnt worry about your credit rating right now, it's not that important. You just need to focus on getting rid of your debt.

Are you able to add another driver to your insurance? possibly a parent? it may bring your price down, give your insurance provider a call and see if that could work. It worked for me!

£10 a month for a bank account is crazy! look around for a better bank account, there may be one that provides what you need cheaper, also how much is breakdown cover? pretty sure you can get cheaper policies (and even cashback through quidco).

can you get a second job? delivering takeaway or something for a few nights a week? Something close so you dont have to use the car.

I'd focus on paying of the BOS first, and putting the other accounts on minimum payment.