How much longer can I keep this up?

HappyMJ

amyjade90 wrote: »

I have no real idea of where to start here but I have been a long term lurker on many of the boards for years and appear to "outsiders" to have it all under control but this is quite far from the truth!

I am 25 and luckily still live at home but I do pay towards bills/keep. I am around £10,000 in debt which seems to now just be spiralling as the interest on my minimum payments are now almost equal, therefore my debts aren't reducing!

My family are definitely not in a financial situation to help me out or to let me pay less for living costs and quite frankly I see it as my mess so I should sort it.

I work as many hours as I possibly can around studying full time too. My wages can differ between £370 a month to £800. I have copied and pasted a SOA for people to see. I have averaged out my wage from last years P60 but as mentioned above my wages differ wildly. I really do not know what else to do and ideally I don't want to affect my credit rating as it is perfect with no defaults or late payments to any of my accounts.

Amount (£)
Monthly Income (after tax)
585

Enter your monthly expenditure
Amount (£)

Rent
200


Mobile Phone - Unfortunately due I was sucked into the "latest model" and still have another year and a half before I can change.
£42


Groceries etc.
15 - This is for my dog food each month, luckily he is pretty cheap to feed!

Clothing
50 - I would say £20 is for work uniform each month, unfortunately I work for "one of those" companies that require you to wear the latest stock.


Other Travel
75 - Monthly train pass to work. Due to travelling peak times there is no cheaper way around this.


Pet Insurance/Vet bills
6

Presents (birthday, christmas etc.)
20


Enter your UNsecured Debts e.g. credit cards
Debt description Debt (£) Min Pay (£) Annual Rate (%)

Barclaycard

£4873

£101

29.9%

MBNA

£3300

£80

29.9%

MBNA

£2690

£40

0.00% - For another year I believe.




Total monthly income: £

585

Expenses (incl. HP & secured debts): £

408

Available for debt repayments: £

177

Unsecured debt repayments: £

221

Surplus (shortfall if negative) £

-44

Personal Balance Sheet Summary
Assets: £

0

Secured & HP Debt £

-0

Unsecured Debt £

-10,863

Net Assets £

-10,863



I can't keep sticking my head in the sand for much longer but I have no idea what to do. Any help would be much appreciated. Thanks in advance.

You can keep sticking your head in the sand for as long as the banks continue providing you with credit and as you have been making all the payments on time that is very likely.

I'd attempt to apply for a balance transfer card at 0% for some time to reduce the interest payable on some of your debt. It might only be £1,000 of credit limit but it'll save you £299 over 1 year for a £30 fee.

Really the only solution is to work full time. You are hopefully getting an education which will enable you to earn money in the future so I personally wouldn't worry about accruing too much debt whilst you are studying. Of course you need to reduce the rates as much as possible but I think concentrating on repaying the debt can wait until you've finished your full time studies and have a proper job.

Have you got all the 0% student overdrafts that you can apply for? I'd get onto the banks. They have some good current accounts with no interest on overdrafts.

parsniphead

I used to work for the above many years ago when we received a 75% discount and it had no effect on wages. I have to say when the news broke about the 25% discount and the effect on wages I was disgusted. They don't pay a lot and the clothes are expensive. A so called ethical company....not so much anymore.

I think you need to find a job which supplies a uniform. It's hard having to keep finding money to update every few weeks.

lazer-zxr

Considering you're a student, have you had a look through the student area of this forum.

You may be eligible for:
1) interest free loans from banks (where the gvmt picks up the interest)
2) student discount you can use to help your family out, and maybe get a reduction on your board.
3) Depending on other adults in the household and their employment status, a 25% reduction in council tax.

These are just what I can think of off the top of my head.

When I was a student, I worked in a supermarket, which offered 10% discount to staff. My parents could use my discount card, and reduced my board by £40 per month.

Kebby

I'm not entirely sure if it would be possible on your income, but possibly something to look at using moneysupermarket.com's smart search - but maybe taking out a loan to cover the debt might be worthwhile if it is at all plausible?

Doing a quick search you could potentially get £10k over 5 years for around £182 a month, that's slightly less than your minimum repayments now, and is at a much much lower rate than your credit cards (around 3.5%).

This would mean you'd actually be happy in the knowledge you're knocking some money off the debt until you finish uni, without racking up more in interest charges on the cards, and then when you finish uni you can quite quickly wack off the remaining debt from the loan.

As I said it might not even be an option with your current income - but thought I would throw it out there just in case it is something you can get.

Failing that - have you considered a student loan? The rate would again be much lower than your credit cards, and having a student loan does not impact on your credit rating, so would be far better than having credit card debt you can't pay.

Ultimately I think the interest is what is crippling you, and needs to be addressed!

But, finally as a last resort if you don't like the sound of any of the above, I would agree with other posters that looking for a job that is closer to home, thereby reducing the £75 a month train fee, and also one that doesn't require purchase of 'uniform' will free up more money for you to pay off the debts thereby hopefully reducing them quicker.

Good luck!!