Not sure where to start...

sunshine81

Just a couple of small things...

Are you getting council tax discount, that is, if you are a full time student.

Have a look all over the boards, there's some great advice and threads about, I'm finding the dfw challenge boards particularly helpful atm.

good luck, you can sort this x

Movingon5464

You have the option of continuing as you are and making minimum repayments on your debts but have no life insurance and an interest only mortgage OR take out life insurance and a repayment mortgage and pay whatever is left to your creditors through a debt managenent plan. Your credit history will be ruined for 6 years (read up on getting defaults at the start) but you would have your home and security for your family.

peaceandfreedom

Agree with every word Jon B said - a) having no life insurance and b) no means to pay off your mortgage should be your main concerns. You might to want to use a broker such as Cavendish online to get a good quote for life insurance for you and your OH. I would consider this an immediate priority.

You then need to think about converting your mortgage to repayment, though I imagine that will have to wait until you are qualified and have a better salary.

15000 is a gigantic overpayment from Child Tax Credits - we were overpaid in the past, they do seem to take a long time to react to changes in circumstances. I knew we'd been overpaid though (it was a backpayment) and kept it to one side.

I totally understand about feeding those great big teenage boys, fretting over the food bill is probably not going to make a huge difference to your SOA, there are easier gains to be made elsewhere. I know in our house there is a constant refrain of 'there is NOTHING to eat'- what they mean is there is no JUNK to eat - I've decided they can buy their own junk if they want it .

I know it seems like you have a big task ahead of you but you can turn things around. I used to spend more than I earned and I used to stick things like car repairs on a credit card. I finally came to my senses and learned to budget. And I closed down my credit card account and just kept the balance transfer cards, which are cut in half. I don't trust myself and it does sharpen the mind knowing that all costs are going to have to be paid with actual money.

Since doing that, I have reduced CC debt considerably and also cleared two overdrafts. It's just a different mindset. I now quite proudly say at work 'I'm too tight to pay for X,Y,Z.....'

I would also re-iterate how much help it is when the kids start earning their own money to pay for their own luxuries, clothes, lunch, mobiles etc. 16-yr-old could look for a job, not sure if transport is an issue but we drove all our children to their jobs for years. Their earnings ranged from 140 to £400-ish, well worth it and great on their CV as well.

ifonlyihadnt...

Wow, that was quite hard to read and made me shed a tear. I think my husband and I have ignored the interest only predicament, I don't think we can do anything at present as I am not in a full time job but I qualify next summer and will then be able to change to repayment. You are all right about life insurance, we did try and get it when we took out our mortgage 10 years ago but my husband had had some ill health and it was well over £100 to insure him so we didn't (not the right decision I know). Lol to the pet being insured for more than us, the £40 is insurance for 2 pets, monthly plans that cover all their jabs, flea treatment etc... and their food.
My son is desperate to get a job but he is not 16 until the end of this month and a lot of places will not employ until summer of gcses, he is looking though. I do feel bad cancelling things like Spotify but you're right it is an unnecessary luxury as is Sky movies which can also go.
I am finding the advice very useful, thank you.

peaceandfreedom

It can be tough to face these issues, Ifonly, but you will feel so much better when you have started to sort things out and have a plan of action. While we are talking kids, have you and OH made a will and decided who would be guardians for your children if you both died at the same time? That's the last of the doom and gloom, I promise!

Your son might be able to get a job, even if it's only a seasonal one in the run-up to Christmas. A lot of places prefer teenagers to adults, as they can pay them less. And a nice strapping lad will always be useful . (On the minus side, some supermarkets prefer 18-year-olds because they can sell booze and cigarettes without having to check with an adult.) He could also offer his services as a babysitter - easy money, sitting there being paid to watch TV and eat other people's snacks. He could print out his details and pop them through local letterboxes.

Anyway, really just wanted to wish you luck - hopefully you'll look back on this in a year's time and see it as a good turning point .

determined_new_ms

Movingon5464 wrote: »

You have the option of continuing as you are and making minimum repayments on your debts but have no life insurance and an interest only mortgage OR take out life insurance and a repayment mortgage and pay whatever is left to your creditors through a debt managenent plan. Your credit history will be ruined for 6 years (read up on getting defaults at the start) but you would have your home and security for your family.

I think this is excellent advice and really should be given a lot of thought.

My advice, for what it's worth, is you really do need to consider stopping all these incidentals for your children. I know how hard that is - as a parent who was in debt while my kids were teenagers - but you really cannot afford these. I know teens can be stroppy so you may get some kick back, but in life they need to learn there are consequences and you can only have what you can afford. Otherwise are we setting them up with a false sense of entitlement? (am not suggesting you are, just my own observations of being a parent paying for things we didn't have the money for).

I also think you could bring your grocery spends down a lot. Well done for ditching the big 4 and moving to Lidl but now I think you need to really drill down on this. We have been forced to cut our cloth accordingly as I lost my job recently and now have 1 income. In order to do this I have been shopping very smart with groceries to bring our bill in at around £35 pw (2 adults & a toddler) by looking at what is on offer in Lidl & Aldi each week and tayloring our meals around that, as well as popping to sainsburys & asda at times when there is likely to be reduced meat and then freezing. Snack are in season fruit - blackberries making a huge appearance this month! - and once a fortnight I make a cake and some brownies, cut them up into slice and freeze so they can be got out on a daily basis/as and when needed.

Just some things for you to consider. HTHs

dancingfairy

You might want to redo your SOA and add things in like the catalogue debt, the gymnastics, cheerleading, spotify, etc.
You probably also want to include putting an amount away each month for car repairs.
The more accurate a picture you come up with the easier it is for you to see in black and white, the issues. It will also help to have a fuller SOA for when you contact one of the debt charities (if you decide to do this).
df

Movingon5464

And remember to add something for prescriptions and dental appointments.

And £20 pm clothes for 5 people ! This could be realistic for a few months but you need to prepare a budget that could work realistically for a number of years.

You really do need a DMP in my opinion. Stepchange are a free charity who could help you. Don't pay anyone to do this for you.

Posting your story and asking for advice says to me that you know that continuing as you are is getting you nowhere. You are juggling so much trying to make ends meet. I think you will feel a lot better once you have sorted out your mortgage, life insurance and have a realistic budget - not extravagant but one you can live with. Then pay your creditors what is left. Remember credit cards are non-priority debts. It sounds like you have been making them a priority. Your situation is not too bad but it probably feels that way because you have your priorities all mixed up. Sort it out and then you can enjoy your family and new career while repaying the debts at the pace you can afford. Sort out the mortgage before starting a DMP though if you do decide to go down that route as your creditors will put default notices on your file which will make it difficult to remortgage and it is generally difficult to get a mortgage will on a DMP.

Don't worry. You will sort this out - you just need to stop juggling and be realistic.

engineer_amy

determined_new_ms wrote: »

My advice, for what it's worth, is you really do need to consider stopping all these incidentals for your children. I know how hard that is - as a parent who was in debt while my kids were teenagers - but you really cannot afford these. I know teens can be stroppy so you may get some kick back, but in life they need to learn there are consequences and you can only have what you can afford. Otherwise are we setting them up with a false sense of entitlement? (am not suggesting you are, just my own observations of being a parent paying for things we didn't have the money for).

I agree with this, I'm sure you love your kids and want to cater to their every whim, but you must cut down in this area. At least until they are old enough to work part time and pay for things themselves.
They will get stroppy if you just cut these things out but don't tell them why.


The older boys should be mature enough if you sat down and explained honestly about the situation, they should be prepared to make a few sacrifices. You probably have a nice house that the boys can bring their friends to, in an area where the friends live close by. Explain that if you don't make cut backs, then its possible you will have to downsize, or move to a cheaper area, away from their friends and somewhere they may not want to bring their friends back to.


Also a good time to teach them about financial responsibility and saving.

blisteringblue

Best of luck ifonly, believe me you are in the right place for help, and you can always rely on the good folks here for cold brutal truths, while it can be hard to read sometimes it is always good advice.